08.04.2026 00:02

An U.S. appellate court has rejected an enforcement effort by New Jersey’s gaming regulators against Kalshi, a platform that offers contracts tied to the outcomes of sports events. In an opinion released on Monday, the Third Circuit Court of Appeals voted 2‑1 to uphold Kalshi’s contention that the Commodity Exchange Act (CEA) overrides the state’s statutes, thereby opening the door to a possible showdown over gambling legislation before the nation’s highest court.

Kalshi’s chief executive, Tarek Mansour, celebrated the decision on the social‑media platform X, describing it as a major victory for the industry and for millions of participants. The appellate panel affirmed the district court’s finding that the U.S. Commodity Futures Trading Commission (CFTC) possesses “exclusive jurisdiction” over sports‑related event contracts, which are classified as swaps under federal law.

Circuit Judge David J. Porter explained that allowing New Jersey to impose its gambling rules would clash with the CEA, effectively barring Kalshi—an entity licensed as a designated contract market and subject solely to CFTC oversight—from offering its sports‑event contracts within the state. “State regulation creates the fragmented framework that Congress sought to replace when it created the CFTC,” the judge wrote.

The Third Circuit’s affirmation follows a recent Nevada ruling that extended a prohibition on Kalshi’s event‑based contracts, part of a broader wave of state actions targeting prediction‑market betting. This growing mosaic of divergent state decisions may compel the Supreme Court to revisit its 2018 ruling that granted states the authority to regulate sports gambling, potentially reshaping the legal landscape for prediction markets nationwide.

(Information compiled from internet sources.)