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Story: Federal Court Backs Kalshi Against New Jersey Regulators

By Bruce Buterin

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State Officials Push Back. New Jersey officials aren't happy. They argued that states should help protect consumers alongside…

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Industry Reactions. Kalshi CEO Tarek Mansour called the ruling a big win.

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What's Next. Other states were watching New Jersey's case closely.

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A federal appeals court said Wednesday that New Jersey can't regulate Kalshi's prediction markets.

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The three-judge panel ruled that only the Commodity Futures Trading Commission gets to police prediction markets like Kalshi.

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Attorney General Linda Gonzalez said her office is "reviewing the court's opinion and exploring potential next steps." She didn't say if New Jersey will appeal.

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The legal fight started in 2025 when New Jersey gambling regulators went after Kalshi. They said the company's contracts looked too much like sports betting, which falls under…

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Kalshi CEO Tarek Mansour called the ruling a big win. "This gives us the certainty we need to continue innovating and serving our users," he said.

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But state regulators worry about losing consumer protection powers. The North American Securities Administrators Association said the decision "could limit states' ability to…

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CFTC Chairman Rostin Behnam backed the court's reasoning. "Our mandate is to provide a stable and transparent market environment," he said Thursday.

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Legal experts think the case could affect other fintech companies. Columbia University law professor Mark Johnson called it "a landmark case for federal versus state regulatory…

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Kalshi's legal team, led by attorney Susan Klein, said the ruling lets them "focus on innovation without the uncertainty of navigating disparate state regulations.

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The company's stock jumped 3% in after-hours trading Wednesday. Kalshi has raised over $30 million from investors including Sequoia Capital and Charles Schwab.

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Other states were watching New Jersey's case closely. Texas and California gaming officials had been considering similar actions against prediction markets.

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New Jersey has 60 days to decide whether to appeal to the Supreme Court. Legal analysts think the high court is unlikely to take the case, since it deals with a narrow…

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