Ninth Circuit Rules Nevada Can Regulate Kalshi Sports Betting Platform
The Ninth Circuit ruled Nevada's gaming laws apply to Kalshi's sports betting contracts.
Why it matters: This decision challenges Kalshi's claim that its event contracts are swaps under federal law, affecting how sports betting platforms comply with state regulations and operate legally across jurisdictions.
- On August 28, 2026, the Ninth Circuit unanimously rejected Kalshi's claim that its sports event contracts are federally regulated swaps.
- The court affirmed that Nevada's gaming laws apply since Kalshi's contracts amount to sports gambling irrespective of labeling.
- This ruling conflicts with the Third Circuit's April 2026 decision favoring Kalshi, creating a circuit split likely to prompt Supreme Court review.
- Nevada's Attorney General praised the decision as a victory for state and tribal regulators asserting local authority over sports betting platforms.
On August 28, 2026, the U.S. Ninth Circuit Court of Appeals ruled that the federal Commodity Exchange Act does not preempt Nevada's gaming laws when applied to Kalshi's sports event contracts, affirming the state's authority to regulate these betting activities. The three-judge panel unanimously determined the substance of Kalshi's contracts is sports gambling "regardless of whether they are labeled as swaps," rejecting Kalshi's argument that the Commodity Futures Trading Commission (CFTC) has exclusive regulatory authority over such contracts under federal law (Ars Technica).
This decision directly conflicts with the Third Circuit's April 2026 ruling, which held that New Jersey could not regulate Kalshi's platform, creating a split among federal appellate courts and increasing the chance of the Supreme Court taking up the issue (Investing.com).
The Ninth Circuit also remanded questions regarding election-based contracts to the district court for further examination (Holland & Knight).
Nevada's Attorney General's office hailed the ruling as a significant victory, emphasizing that Kalshi's operations are subject to state gambling laws despite their classification as event contracts rather than traditional bets. Kalshi has indicated plans to seek additional legal review, though its trading remains suspended in Nevada for now (AP News).
Attorney James T. Meggesto of Holland & Knight summarized the ruling as a "major victory for states, Tribes, and gaming regulators opposing Kalshi's argument that federally regulated prediction markets can offer sports betting nationwide without complying with state gaming laws." This ruling deepens the legal uncertainty around whether sports betting platforms are swaps markets under federal law, an issue likely to be resolved only by the Supreme Court (Holland & Knight).
By the numbers:
- August 28, 2026 — Date of Ninth Circuit ruling
- April 2026 — Date of conflicting Third Circuit ruling
- 3 judges — Panel size for both the Ninth and Third Circuit rulings
Yes, but: The ruling leaves some ambiguity regarding election-based contracts, which the Ninth Circuit sent back for additional district court review.
What's next: The split between the Ninth and Third Circuits increases the likelihood the U.S. Supreme Court will review whether sports betting platforms like Kalshi are swaps under the Commodity Exchange Act.