Sixth Circuit rules Kalshi sports contracts face state regulations

A panel of Sixth Circuit judges ruled Friday that Kalshi’s sports-related event contracts are not swaps. The contracts are therefore subject to state gaming regulations instead of rules from the federal Commodity Futures Trading Commission. The ruling addresses two cases that Kalshi brought against regulators in Ohio and Tennessee. Kalshi sought injunctions that would block the states from suing it. An Ohio federal court denied Kalshi’s motion. A Tennessee federal court granted Kalshi’s motion. The decision is the latest appeals court ruling in the dispute between states and prediction market providers.