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CFTC Signals Supreme Court Battle After Nevada Wins Prediction Markets Case

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CFTC Signals Supreme Court Battle After Nevada Wins Prediction Markets Case

A court’s ruling that sports event contracts are not swaps that are regulated exclusively by the Commodity Futures Trading Commission (CFTC) set the stage for a Supreme Court case, a CFTC spokesperson told PYMNTS Friday (Aug. 28).

The statement came after a Friday ruling in a court battle between Nevada and three companies offering prediction markets.

The Nevada Gaming Control Board said that the Friday ruling by the Ninth Circuit court rejects the view that the federal Commodity Exchange Act preempts application of the state’s gaming laws to sports event contract.

The ruling came in the Board’s court battles with three companies that offer these event contracts on prediction markets: Crypto.com, Kalshi and Robinhood, according to the release.

The Board considers sports events contracts to be wagers, and the companies offering them to be required to be licensed in the state of Nevada, per the release.

“This completely vindicates what we have been saying all along,” Nevada Gaming Control Board Chairman Mike Dreitzer said in the release. “This is sports betting and needs to be properly regulated by the state.”

Reached by PYMNTS, Kalshi spokesperson Dani Lever said in an emailed statement: “The Ninth Circuit agreed with the Third Circuit on a fundamental point: federal law prevents states from regulating trading on a federally licensed exchange, like Kalshi. Despite the Ninth Circuit’s opinion, we still believe the CFTC regulations as written do not prohibit sports contracts, and in any event, the CFTC is working to clarify those regulations.



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