The Ninth U.S. Circuit Court of Appeals has ruled unanimously that Nevada may subject Kalshi's sports-event contracts to state gambling laws, handing state gaming regulators a significant victory in their jurisdictional dispute with the Commodity Futures Trading Commission (CFTC).
The decision addresses a core question dividing federal courts: whether sports-related prediction contracts qualify as financial derivatives falling under exclusive CFTC regulation, or whether they function as conventional sports wagers subject to state oversight.
The ruling directly conflicts with an April decision from the Third Circuit, which held that New Jersey could not regulate Kalshi's sports contracts. That earlier decision favored federal, CFTC-exclusive oversight of such contracts, while the Ninth Circuit's ruling supports state authority to apply gambling laws to the same type of product.
