A Nevada federal judge has lifted Kalshi’s injunction and ordered the prediction-market operator to pull its sports event contracts in the state, ruling that its markets constitute sports betting and fall under state gaming authority rather than federal derivatives oversight. The decision, issued Nov. 24 by Judge Andrew Gordon, ends the temporary protection Kalshi received in April and opens the door for Nevada regulators to enforce a cease-and-desist.
Kalshi plans to appeal, filing an emergency motion for a stay on Nov. 25.
What Happened?
In April, Kalshi received a temporary restraining order allowing it to keep sports-themed contracts live in Nevada while it fought a cease-and-desist from the Nevada Gaming Control Board (NGCB). On Monday, Gordon reversed that decision, siding with the NGCB and ruling that Kalshi’s Super Bowl, March Madness and prop-style markets align with traditional sports wagering—not swaps under the Commodity Exchange Act.
Gordon wrote that Kalshi’s products are “sports wagers and everyone who sees them knows it,” noting the company previously advertised itself as the first app offering legal sports betting nationwide despite not holding state gaming licenses.
Why the Court Changed Course
Several developments since the spring influenced the court’s position:
- A Maryland court denied Kalshi an injunction over similar contracts, reinforcing state authority on sports wagering.
- Gordon previously denied Crypto.com an injunction in October, finding sports contracts are not swaps under the CEA. Crypto.com has since withdrawn sports markets in Nevada.
- Kalshi expanded its sports offerings, including prop-style markets, which the court viewed as lacking real-world economic purpose, contradicting earlier arguments from the company.
The judge wrote that new facts — combined with evolving case law — shifted the balance of harms in favor of Nevada regulators and the public interest.
Judge Rejects Kalshi’s Claims of Harm
Kalshi argued that geofencing Nevada would cause financial and reputational damage. Gordon disagreed, pointing to Crypto.com’s compliant exit and stating the risk of harm to Nevada’s regulated wagering industry outweighed Kalshi’s business concerns.
“Kalshi could have proceeded cautiously… but instead it greatly expanded its offerings,” Gordon wrote, noting the company contributed to its own legal risk.
What’s Next?
Kalshi filed an emergency motion for a stay pending appeal, warning of potential criminal enforcement if it continues operating sports contracts in Nevada. The case now moves to the appeal stage, with the CFTC having already instructed designated contract markets to prepare contingency plans for state-level shutdowns.
Impact on Sports Betting Markets and Exchanges
For bettors and regulators, this ruling reinforces a key boundary: sports prediction contracts remain gambling products under state jurisdiction, not commodities markets regulated federally.
Key implications moving forward:
- Operators offering sports-based event contracts face heightened regulatory risk.
- The ruling strengthens state oversight precedent, limiting federal venue-shopping.
- Exchanges may need to geofence markets or focus on political/economic contracts instead of props and outcomes tied to games.
Industry Outlook
This case sits at the intersection of sports betting, derivatives trading, and prediction markets — a space attracting major interest from financial exchanges and sportsbooks as U.S. wagering shapes into a $100B+ handle industry. If Kalshi ultimately loses on appeal, it could reinforce state supremacy over sports-related markets nationwide, potentially slowing the expansion of federally regulated event-contract trading.
Kalshi maintains that its contracts fall under CFTC authority and intends to keep fighting in court.
- SCCG Management. The Gambling Industry’s Global Connector. Access Here.
- Source: https://sportshandle.com/nevada-judge-orders-kalshi-to-halt-sports-event-contracts-in-the-state/