Appeals court says states can regulate Kalshi sports prediction markets

A U.S. appeals court has ruled that Ohio and Tennessee may apply their gambling laws to Kalshi's sportsrelated event contracts, adding another legal setback for prediction market platforms. The 6th U.S. Circuit Court of Appeals said the contracts do not clearly fall under the Commodity Exchange Act's definition of a swap, and that federal law does not preempt the states' gambling rules. The decision reverses a lower court ruling in Tennessee and supports Ohio's position. The case is part of a broader dispute over whether sports prediction markets should be treated as federally regulated financial products or as gambling activity under state law. Similar cases have produced mixed rulings in other circuits, and the issue is widely expected to reach the U.S. Supreme Court.