A federal appeals court has upheld Nevada’s authority to prohibit the prediction market platform Kalshi from operating within the state. The 9th U.S. Circuit Court of Appeals issued a unanimous decision Friday, determining that the platform’s offerings constitute sports gambling regardless of how the company labels them.
The dispute originated when Nevada’s Gaming Control Board issued a cease-and-desist order to Kalshi in March 2025, alleging the company was conducting illegal sports betting activities in violation of state gaming laws. Kalshi contested this characterization, arguing it functions as a “designated contract market” offering lawful sports event contracts rather than traditional betting. However, court documents revealed that Kalshi’s own promotional materials described it as “the first app for legal sports betting in all 50 states.”
The panel’s decision creates complications for Kalshi and similar prediction market companies. Notably, a conflicting ruling from the Third Circuit Court in Philadelphia previously sided with Kalshi on related legal questions. Federal regulators expressed disagreement with the 9th Circuit’s conclusion, suggesting the disagreement between courts will likely require Supreme Court intervention to establish definitive national standards.
Kalshi has indicated plans to pursue additional legal remedies. Nevada Gaming Control Board leadership welcomed the ruling as validation of its enforcement position that such platforms require proper state oversight and regulation.
Originally reported by Mashable →
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