Kalshi, Headed to Supreme Court, Sees CFTC Rule Rewrite Reshaping Case
Summary
- Kalshi's chief executive said a CFTC rule revision could be released in the coming weeks or months.
- Kalshi said a CFTC rule revision related to sports event contracts, the central issue in the lawsuit, could affect future court rulings.
- The report said the CFTC had proposed revising its blanket ban on event contracts tied to gaming activities such as sports and instead reviewing them case by case for public interest, potentially allowing many such contracts.
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Kalshi, the U.S. prediction-market platform embroiled in a legal fight with state governments, has expressed optimism that changes to Commodity Futures Trading Commission rules could alter the case.
Bitcoin.com reported on September 5 that Kalshi Chief Executive Officer Tarek Mansour said in a recent interview that new CFTC rules clarifying the issue could emerge in the coming weeks or months.
The central question in the lawsuit is whether states can regulate sports event contracts offered by a CFTC-registered exchange as sports betting. New Jersey asked the U.S. Supreme Court on September 2 to take up the matter.
Kalshi believes revisions to the CFTC rule at the center of the dispute could also affect future court rulings. Mansour said a Ninth Circuit Court of Appeals ruling had increased legal uncertainty, but added that new CFTC rules would clarify the issues involved.
In June, the CFTC proposed revising its current rule that broadly bars event contracts tied to gaming activities, including sports. The proposal would review such contracts case by case based on whether they serve the public interest. It would classify sports as gaming while still allowing many contracts tied to game outcomes.
Kalshi plans to file its opposition to New Jersey's Supreme Court petition within 30 days.
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