A federal appeals court has cleared the path for Nevada regulators to enforce a temporary restraining order against the prediction market platform Kalshi. The Ninth Circuit Court of Appeals denied Kalshi’s request to block the action, allowing state authorities to proceed with restricting the company’s operations in Nevada. Kalshi had warned that without intervention, it would face imminent harm and could be forced to navigate conflicting rulings across multiple courts. The decision raises questions about state oversight of prediction markets and signals increasing regulatory scrutiny for platforms offering event-based contracts.
Kalshi has been challenged by the Nevada Gaming Control Board, which issued a cease-and-desist order in March 2025, initially targeting sports-related prediction contracts. The state later sought to broaden restrictions, potentially prohibiting Kalshi from offering any event-based contracts within Nevada. In response, Kalshi attempted to move the case to federal court, emphasizing that multiple simultaneous proceedings could threaten its appellate rights and create conflicting interpretations of state and federal law. The Ninth Circuit’s decision removes the temporary stay that could have delayed the state’s enforcement.
The platform highlighted the risk of litigation in four separate forums, including both Nevada state and federal courts, as well as two different appeals court cases. Kalshi argued that such a scenario could result in contradictory outcomes, where a state court might determine that the Commodity Exchange Act does not preempt Nevada’s gambling laws while a federal court could reach an opposite conclusion. The company emphasized that facing overlapping judgments would disrupt its business operations and force it to defend the same issue repeatedly, creating legal and financial uncertainty.
Experts say the temporary restraining order could effectively halt Kalshi’s presence in Nevada for at least two weeks, pending hearings on a preliminary injunction. Legal analysts note that this move is part of broader state-level efforts to regulate prediction market providers, especially those linked to sports-related products. At the same time, the Commodity Futures Trading Commission has maintained that it holds exclusive oversight over these platforms. The CFTC has even signed agreements with major sports leagues to clarify the regulatory framework, illustrating the tension between federal jurisdiction and state authority.
Kalshi joins a growing list of prediction market providers facing scrutiny across multiple states, with regulators asserting jurisdiction over event-based contracts that resemble gambling products. As the company navigates complex litigation, it must balance compliance with state directives while asserting its federal protections. The outcome in Nevada could set an important precedent for how prediction markets are regulated across the United States and may influence the operations of similar platforms in other jurisdictions. The case continues to develop as stakeholders watch closely for updates in the coming days.
