Prediction market platform Kalshi has lost its bid to prevent Utah from enforcing anti-gambling laws against it while its case proceeds on appeal. The 10th Circuit Court of Appeals denied Kalshi's emergency motion for an injunction pending appeal, clearing the way for the state to pursue civil or criminal action against the platform.
A federal judge previously ruled that Utah's anti-gambling laws apply to Kalshi's sports betting contracts, granting the state's summary judgment in a lawsuit Kalshi filed earlier this year. The latest court decision upholds that ruling and represents a significant setback for the prediction market platform.
States Establish Dominant Track Record
Kalshi's loss adds to a streak of regulatory victories for states. Since a Minnesota decision, states have won 12 consecutive federal court rulings against prediction markets. According to legal analysis, states have prevailed in 35 out of 41 court cases involving preliminary injunctions, temporary restraining orders, or stays and injunctions pending appeal—an 85% success rate.
Jurisdictional Dispute Continues
The core dispute centers on regulatory authority. State regulators argue that prediction market platforms operate as unlicensed sports betting platforms and fall under state jurisdiction. Prediction market platforms counter that the CFTC has exclusive jurisdiction over sports contracts because they classify as swaps under federal law.
The Supreme Court may ultimately settle the question. New Jersey has filed a certiorari petition asking whether states have jurisdiction over sports prediction markets. However, market data suggests limited expectation of near-term Supreme Court action, with predictions markets showing only a 31% probability the top court would accept such a case by year-end.
