A federal judge in Nevada has reversed a legal victory for prediction-market operator Kalshi, lifting the preliminary injunction that had prevented state regulators from classifying its sports-event contracts as illegal gambling, Pat Evans of iGaming Business reported. U.S. District Judge Andrew Gordon rejected Kalshi’s claim that its registration with the Commodity Futures Trading Commission protects its markets from state authority. He wrote that Kalshi’s interpretation of the Commodities Exchange Act would effectively draw sports betting across the country into federal derivatives regulation and “upset decades of federalism” in gambling law. Shares of competitors DraftKings (DKNG) and Flutter Entertainment (FLUT) are up 7% and 2% respectively following the reversal.
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