A federal appeals court has cleared the way for Nevada state regulators to enforce a restraining order against prediction market Kalshi. The Ninth Circuit Court denied Kalshi’s emergency request to stay the case, sending it back to a lower federal court. Gaming lawyer Daniel Wallach stated a temporary order appears imminent, which would block the platform’s sports-related contracts in Nevada for at least 14 days.
A federal appeals court has cleared Nevada state authorities to enforce a temporary restraining order on Kalshi to block its sports event contracts. The Ninth Circuit Appeals Court denied Kalshi’s emergency request to stay a lower court proceeding.
This allows the case to be sent back to federal court and permits Nevada’s regulators to take action. Gaming lawyer Daniel Wallach said a temporary restraining order against Kalshi now appears imminent. “Since a TRO is not appealable under Nevada law, Kalshi would be required to exit the state in the interim,” he added.
The Nevada Gaming Control Board sent Kalshi a cease-and-desist in March over its offering of sports event contracts. State regulators argue these contracts constitute unlicensed sports betting under Nevada law.
Kalshi has argued in court that its event contracts are under the sole federal jurisdiction of the Commodity Futures Trading Commission. The company claims any block on its event contracts would cause it “imminent harm.”
Prediction markets such as Kalshi and Polymarket have recently surged with weekly trading volumes consistently exceeding $2 billion, according to Dune Analytics. This growth has attracted increased scrutiny from lawmakers concerned over insider trading and market manipulation.
State regulators in Connecticut, New York, New Jersey and other states have also sought action over sports event contracts. Kalshi and rival platforms Crypto.com, Polymarket, and Coinbase are in legal battles with multiple states.
In a motion, Kalshi argued that letting Nevada proceed creates a serious risk of conflicting rulings. The company said courts could reach “exactly the opposite conclusion” on whether federal commodities law preempts state gambling laws.
