Federal appeals court rules Nevada can regulate Kalshi

The 9th U.S. Circuit Court of Appeals in San Francisco ruled that Nevada may regulate Kalshi’s prediction‑market platform, overturning a contrary decision from the 3rd Circuit in Philadelphia and setting the stage for a potential Supreme Court showdown. The court said Kalshi was unlikely to show that the federal Commodity Exchange Act pre‑empted Nevada from requiring a gaming licence for contracts that let individuals stake on the outcomes of sporting events. The ruling, issued Friday, contradicts a 3rd U.S. Circuit Court of Appeals decision from April 6 that held New Jersey cannot regulate Kalshi’s platform. Representatives of New York‑based Kalshi said they would seek further review of the decision. “The Ninth Circuit agreed with the Third Circuit on a cardinal point: Federal instrumentality prevents states from regulating trading on a federally licensed exchange, similar Kalshi,” institution typical Dani Lever said precocious Friday. “Despite the Ninth Circuit’s opinion, we inactive judge the CFTC regulations arsenic written bash not prohibit sports contracts, and successful immoderate event, the CFTC is moving to clarify those regulations. We volition beryllium seeking further review.” In the meantime, trading on sports, amusement and elections contracts remains blocked in Nevada, Kalshi has said, although Gaming Control Board agents contend they have been able to continue to access the site in the state and regulators are asking a Carson City tribunal to find Kalshi in contempt and enforce the $120,000 daily punishment against the firm that it earlier ordered. The $120,000 penalty was ordered if Kalshi failed to geofence operations and make itself unavailable to Nevada consumers. Kalshi says it has complied, but the Control Board disagrees. Nevada gaming regulators said they were pleased with the court’s ruling. “We are pleased with the Ninth Circuit’s ruling contiguous successful favour of Nevada,” Gaming Control Board Chairman Mike Dreitzer said. “This wholly vindicates what we person been saying each along. This is sports betting and needs to beryllium decently regulated by the state. The Nevada Gaming Control Board has been regulating gaming in the authorities of Nevada for much than 70 years in accordance with the highest standards and champion practices. We volition proceed to vigorously enforce Nevada instrumentality to safeguard gaming in our state.” Dreitzer said the board has taken decisive action in recent months to halt the operations of other prediction markets in the state and has successfully restricted the reach of the unlicensed markets that had been known to operate in Nevada. “Prediction markets offering sports‑event contracts represent gambling and indispensable comply with Nevada’s gaming laws and regulatory framework,” Gov. Joe Lombardo said in a Friday emailed statement. “I commend Chairman Dreitzer and the Nevada Gaming Control Board for their diligent enactment to uphold Nevada’s longstanding regulatory standards, safeguard the integrity of our gaming manufacture and guarantee the nationalist tin proceed to person assurance successful its oversight,” helium said. Kalshi and other prediction markets first appeared on Nevada’s radar about two years ago when the November elections occurred. Then, in March 2025, Kalshi and the Control Board sued each other in federal court. Eventually, the Control Board determined it would pursue amended claims in state district courts. Meanwhile, Kalshi began engaging in litigation across states that permit gambling. The company maintains that prediction markets fall exclusively under federal jurisdiction and are not subject to a patchwork of state gambling laws. The Commodity Futures Trading Commission, the federal agency responsible for regulating financial markets, agrees and has defended prediction markets in court. The Associated Press has reported that courts in Maryland, Nevada, Ohio, New York and Wisconsin have ruled against Kalshi in similar lawsuits, while judges in New Jersey, Tennessee, Arizona and Minnesota have sided with the company. Other states have been allowed to restrict certain aspects of Kalshi’s operations without banning them entirely.