U.S. Appeals Court Rules Sports Prediction Contracts Not Swaps, Dealing Blow to Prediction Market Firm Kalshi

Kalshi lost its case in the Ninth Circuit Court of Appeals, allowing Nevada's gambling regulators to continue treating its sports prediction products as unlicensed gambling. The court explicitly rejected Kalshi's claim that sports prediction contracts fall under federal commodities law protection, stating directly that their essence is sports betting. Election-related contract issues were remanded to the lower court for separate proceedings.