Event contracts, the exchanges that list them, and the running dispute between federal derivatives regulation and state gambling law over who is in charge.
What prediction markets are, and who regulates them
Kalshi has started listing contracts on industry-wide indices of card spending, point-of-sale sales and app downloads, all settled on figures from the data company Carbon Arc. The same vendor already settles Kalshi markets on sportsbook and casino advertising and on DraftKings and FanDuel downloads, and its numbers appear to sit outside the test the SEC used on 13 October to class Cboe's KPI options as securities.
A one-page memo from Defense Secretary Pete Hegseth tells service members and civilians that trading on nonpublic information, classified or not, can bring discipline or prosecution, and calls their bets a signal enemies can read. As reported, it stops short of the ban on military-event trading that lawmakers asked for in May.
The Commodity Futures Trading Commission has opened a false-certification proceeding against two ProphetX contracts on whether an NFL game produces a never-before-seen final score, and stayed them before they traded. It is the first stay of a sports event contract on the CFTC's 2026 filings record, and it turns on the same "economic consequence" test the agency says sports contracts pass.
The FTSE 100 trading group says financial prediction markets will launch in the fourth quarter for professional clients only, as the Financial Conduct Authority still treats them as banned retail binary options. Sports and politics wait on a Gambling Commission licence it has applied for.
The Ohio Casino Control Commission has told every sportsbook, supplier, integrity monitor and testing laboratory it licenses to stop providing services "of any kind" to platforms offering sports event contracts in Ohio, or face reopened suitability investigations. With its cease-and-desist letters to the exchanges now challenged in court, Ohio is turning to the companies that keep them running.
The Senate Commerce Committee chairman intends to file legislation after the 3 November midterms that would bar gambling-linked event contracts, sports included, unless a state or tribe authorises them, Bloomberg Law reports. No text, bill number or co-sponsor is public yet, and the window before this Congress ends is short.
Polymarket's US exchange went to federal court in Columbus on the day Ohio's cease-and-desist deadline expired, leading with a constitutional claim the Sixth Circuit has not decided. Governor Mike DeWine says the state will now file suits of its own.
Utah's Attorney General has sued five Kalshi companies and two Susquehanna firms in Salt Lake County, alleging that the market makers taking the other side of retail trades are gamblers and bookmakers under Utah law. A gaming lawyer calls it the first state enforcement action aimed at a prediction market's liquidity providers.
Two of the six prediction market operators Missouri ordered to stop offering sports event contracts went to federal court on Friday rather than comply. Both cases sit in the Eighth Circuit, which has yet to decide the question that has already split three other appeals courts.
A New Taipei court order sought by the Criminal Investigation Bureau has taken both platforms' websites offline in Taiwan ahead of the 28 November local elections. Kalshi says it does not allow trading there, but its own market data shows open contracts on Taipei's, New Taipei's and Kaohsiung's mayoral races.
The Federal Register publishes the CFTC's two swap rules on Monday: the exclusion for licensed sportsbooks and casinos is in force that day, and the proposal to define event contracts as swaps opens for comment until 18 November. The rule text says the first changes no one's legal rights, and the second is not yet law.
A magistrate judge has recommended that Kentucky's gambling suit against Polymarket go back to the state court where it was filed, leaning on the Sixth Circuit's September ruling against Kalshi, and the same is reported in the Kalshi case. If the district judges agree, a Kentucky judge will hear the state's claims for injunctions, penalties and treble damages.
