Coverage spread: 2 sources — 2 unrated
Lean ratings via AllSides / Media Bias-Fact-Check. How this works.
Where they agree
- The decision conflicts with an earlier 3rd Circuit ruling favoring Kalshi in a New Jersey case, raising the chance of Supreme Court review.
Where they differ
- AZFamily centers the Nevada ruling as the main event with Arizona as a related side note, while Arizona Mirror’s framing suggests the opposite emphasis, treating the Arizona prosecution’s fate as the central stake.
A panel of the 9th U.S. Circuit Court of Appeals ruled Friday that Nevada can continue blocking Kalshi, a prediction-market platform, from offering sports and election betting contracts until it obtains a state gambling license. The court found that federal commodities trading law does not override Nevada’s gambling regulations, a decision that also has direct implications for a separate, ongoing criminal case against Kalshi in Arizona.
What did the 9th Circuit actually decide?
The three-judge panel in San Francisco rejected Kalshi’s argument that Nevada’s gambling law is preempted by federal commodities law. Kalshi had sought an emergency order letting it resume trading sports and election contracts in Nevada while its broader legal fight with the state continued. The judges refused, concluding Kalshi failed to show that federal oversight of its business as a financial exchange should override the state’s authority to regulate gambling. As a result, Kalshi’s sports, entertainment and election contracts remain blocked in Nevada for now. Kalshi said it will seek further review of the ruling.
How does this affect Arizona’s case against Kalshi?
Arizona Attorney General Kris Mayes filed criminal charges against Kalshi earlier this year, alleging it was running an illegal gambling business without a state license. A federal judge in that case issued a temporary restraining order in April and later a preliminary injunction, both premised on the idea that the Commodity Futures Trading Commission (CFTC) has jurisdiction over Kalshi’s business, which would put it beyond the reach of Arizona’s gambling laws. The 9th Circuit’s Nevada ruling undercuts that reasoning, since it comes from the same appellate circuit that covers Arizona. Arizona Mirror reports the order blocking Mayes’ prosecution is now “living on borrowed time,” and Mayes herself said her office is reviewing the opinion for its implications on the state’s own litigation.
Why does this set up a possible Supreme Court fight?
The 9th Circuit’s ruling creates a split with the Philadelphia-based 3rd U.S. Circuit Court of Appeals, which ruled earlier this year that New Jersey could not regulate Kalshi under its gambling laws. David Larson, former chair of the American Bar Association’s Section of Dispute Resolution and a law professor at Mitchell Hamline School of Law, said having two federal appeals courts reach opposite conclusions is “kind of the traditional point” at which the U.S. Supreme Court considers stepping in. He called it significant whenever any U.S. Court of Appeals issues a ruling like this one.
What is Kalshi’s position?
Kalshi maintains it is not a betting platform but a financial exchange, and that its contracts on sports outcomes, elections and other events should be regulated exclusively by the CFTC under federal commodities law, not by state gambling regulators. The company has used that argument across multiple states to resist licensing requirements and enforcement actions. Following Friday’s ruling, Kalshi said it plans to pursue further review rather than accept the Nevada outcome.
What are states saying about the stakes?
Attorney General Mayes framed the ruling as a major win for state authority over gambling, arguing that “calling a sports bet a swap doesn’t make it one.” She said Arizona has built a comprehensive regulatory system for gaming and that the ruling affirms that system, arguing that federal financial reform law was never meant to strip states of their traditional police powers over gambling. She warned that Kalshi’s legal position, if accepted broadly, would effectively federalize sports betting regulation and undo decades of state and tribal oversight designed to protect consumers from unregulated gambling.
What happens next?
Kalshi’s sports, entertainment and election trading remains suspended in Nevada while the company seeks further review, likely first through a fuller 9th Circuit process and potentially the U.S. Supreme Court. In Arizona, the existing injunction shielding Kalshi from Mayes’ prosecution is still in place, but the reasoning behind it now conflicts with the 9th Circuit’s new ruling, raising the odds that Arizona courts revisit it. Mayes said her office is reviewing the decision closely as it weighs its next steps in the state’s own case against the company.
Sources
Featured photo: Veo 3, prompted by P.J. Accetturo via Wikimedia Commons (Public domain)