Connecticut's Attorney General William Tong, Department of Consumer Protection (DCP) Commissioner Bryan Cafferelli, and Governor Ned Lamont shared on August 26, 2026, that...
On August 28, 2028, the Ninth Circuit Court of Appeals ruled in favor of Nevada gambling regulators, deciding that Kalshi’s sports event contracts are gambling and not federally regulated swaps.
The court issued a unanimous 3-0 decision, supporting Nevada’s right to regulate Kalshi’s sports contracts under state gaming laws, as the ruling rejected the prediction market operator’s argument that the Commodity Exchange Act gives the Commodity Futures Trading Commission (CFTC) exclusive authority over the contracts.
Judge Ryan Nelson stated:
“The substance of the sports event contracts offered on Kalshi’s DCM is sports gambling, regardless of whether Kalshi calls them swaps. The CFTC is not a gambling regulator.”
The case started after the Nevada Gaming Control Board sent Kalshi a cease-and-desist letter, saying the company was operating an unlicensed sports pool, after which Kalshi requested an injunction, arguing that its designated contract market status protected it from state gambling rules.
The Ninth Circuit found that Kalshi’s sports contracts effectively allow users to place familiar types of bets, including prop bets, point spreads, and parlays. More than 90% of Kalshi’s trades in 2025 were sports-related, accounting for 95% of its revenue, according to the court.
Kalshi can now ask the Ninth Circuit for a rehearing or take the case to the US Supreme Court. At the same time, back in April 2026, the Third Circuit reached the opposite conclusion in a New Jersey case, finding that the CFTC had exclusive jurisdiction over Kalshi’s contracts.
