Kalshi blocks bets on its own Supreme Court case amid regulatory split

Kalshi refuses to offer Supreme Court outcome markets

Prediction market platform Kalshi has decided it will not allow users to bet on whether the US Supreme Court will take up the company’s legal battles, or what the outcome would be.

A Kalshi spokesperson told Barron’s reporter Nick Devor that the firm is making this choice “on principle.” The company says it does not want to create markets that it could influence, as doing so would break its own rules.

Devor noted that by refusing to list these contracts, Kalshi is removing a tool it could use to hedge against its biggest business risk.

The legal split driving the uncertainty

The decision comes as US courts are divided on whether prediction markets can offer sports-related contracts.

Last Friday, an appeals court in Nevada ruled against Kalshi. The court decided that sports contracts are bets, not swaps, which means they fall under state regulation rather than federal oversight.

This contradicts an April ruling from a different appeals court that sided with Kalshi in a lawsuit against New Jersey. That court said federal regulators like the Commodity Futures Trading Commission (CFTC) should have final say over prediction markets.

Following the Nevada decision, New Jersey filed a petition with the Supreme Court this week. It is asking the high court to resolve the conflict and decide whether prediction markets must follow state sports-gambling laws.

Other states and leagues push back

Pressure on Kalshi is growing from multiple sides. This week, Michigan banned the platform from offering event contracts to its residents. The state threatened a fine of $500,000 per day if Kalshi violates the new injunction.

Additionally, the NFL wrote to prediction markets yesterday reiterating its opposition. The league stated it does not want sports contracts listed that are easily manipulated or “inherently objectionable.”

What this means for the company

Kalshi is currently operating under a CFTC order that allows it to continue business while facing lawsuits in New York and other jurisdictions.

By not listing markets on its own legal fate, Kalshi is avoiding a direct conflict with its integrity policies. However, it also loses the ability for customers to trade on the outcome of the very cases that determine the company’s future.

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