Prediction Markets · Page 4 of 14
Event contracts, the exchanges that list them, and the running dispute between federal derivatives regulation and state gambling law over who is in charge.
A unanimous panel has held that Kalshi's sports contracts are not swaps, and that federal commodities law would not shield them from state gambling law even if they were. It is the second federal appeals court in a month to side with the states, leaving Kalshi with one win in three circuits as the Supreme Court weighs whether to take the question.
Research commissioned by the American Gaming Association says gamblers score higher on financial literacy than non-gamblers, and that prediction-market users are nearly as confident as sports bettors but test like non-gamblers. The trade body is using it against the exchanges.
Kalshi's clearing house wants approval to let a few large traders post less than full collateral on some contracts. Sports, culture and mention markets are excluded, and the CFTC's review runs until early November.
New York's attorney general has filed a second state-court case against a prediction market, this time against Polymarket's US exchange, alleging an unlicensed gambling business open to 18-year-olds. The relief sought mirrors the Kalshi suit that drew the federal regulator into the fight in August.
A Republican senator who co-sponsored a bill to classify sports event contracts as gambling wants the Senate Judiciary Committee to question Donald Trump Jr. and Hunter Biden about trading on their fathers' office. Trump Jr.'s ties to Kalshi and Polymarket are one line in the case, and the committee's chairman is in no hurry.
The Federación Mexicana de Fútbol has filed a trademark suit against Kalshi in federal court in Manhattan, after two months of cease-and-desist letters that the exchange answered by invoking nominative fair use. The case opens an intellectual property front that Kalshi's many fights with state regulators have not touched.
The Commodity Futures Trading Commission's market oversight staff have told exchanges that contracts on whether a person will say a word, attend an event or shake a hand may be treated as presumptively readily susceptible to manipulation. The advisory lands less than a month after a White House teleprompter operator was fined for trading presidential mention markets on advance copies of speeches.
The bank's analysts see yes/no exchange turnover compounding at 70% a year from $410bn this year, and financial derivatives overtaking sport to become the largest category. Five months ago the same firm's 2030 number was $1tn.
The exchange has been meeting regulators in the UK and the EU to argue that its contracts belong to financial supervisors rather than gambling ones, the Financial Times reports, after being blocked in Italy, the Netherlands and France. Britain's Gambling Commission says a prediction market launching here could not classify itself as non-gambling.
A new daily record of $3.01 billion, another $2.82 billion on Sunday, record fees of $18.2 million and $17.6 million, and the worst two days in Kalshi's history for parlay takers, who lost $46.1 million. Strip out the parlay maker side and neither day was a record for taker volume, InGame's analysis shows.
The Indian Gaming Association chair told Gaming America that more tribal lawsuits are coming after the Ninth Circuit, that DraftKings' tribal partnerships in Connecticut, Arizona and Washington are at risk over its prediction-market push, and that the Supreme Court will rule against Kalshi. CNIGA's James Siva: "We're keeping track."
The portal confirmed to Bloomberg that the hub carrying Polymarket probabilities alongside its news was taken down in the spring, while the exchange remains an advertiser. It surfaces in the same weekend as the Journal's account of Polymarket's US compliance failures, and as the company courts financial media to make event contracts look like markets.
Every section, by date: the news archive by month.