US court rules Kalshi cannot block Nevada from regulating sports betting

PANews reported on August 29, according to The Block, that the U.S. Court of Appeals for the Ninth Circuit ruled that prediction market platform Kalshi failed to prove that federal law preempts Nevada's regulatory authority over sports betting, and that Kalshi is not entitled to an injunction.

Previously, the Nevada Gaming Control Board had issued a cease-and-desist order to Kalshi, requiring it to stop offering contracts involving elections and sporting events in the state, and threatened to file criminal or civil actions. Kalshi then sued the Gaming Control Board and the state, and sought a preliminary injunction in an attempt to prevent Nevada from regulating trading in its sports and election event contracts. The district court initially granted the injunction, but later revoked it following a ruling involving Crypto.com. However, the appellate court said on Friday: "We hold that Kalshi has not shown that the Commodity Exchange Act (CEA) likely preempts state gaming laws as applied to its sports event contracts, and we also hold that the district court did not abuse its discretion in dissolving the injunction." The panel of judges stated: "The panel concludes that the Commodity Exchange Act likely does not preempt Nevada gaming laws as applied to Kalshi's sports event contracts."