Ninth Circuit Blocks Kalshi's Bid to Preempt Nevada Sports-Betting Rules

Kalshi Faces Regulatory Setback as Ninth Circuit Upholds Nevada Sports-Betting Rules

The Ninth Circuit has denied Kalshi's request to enjoin Nevada from enforcing state gaming rules against its sports contracts, finding that Kalshi failed to show federal commodity preemption. The decision is a significant blow to the prediction-market platform and raises concerns about regulatory risk for crypto derivatives and broader adoption in the DeFi/CEX ecosystem.

The court's ruling is a departure from the Third Circuit's earlier decision supporting Kalshi, creating a circuit split that may lead to Supreme Court review. The CFTC's proposed rules are also exposed to potential Administrative Procedure Act (APA) lawsuits following the court's decision.