New Jersey has taken its fight over Kalshi's sports bets to the Supreme Court.
The state's attorney general, Jennifer Davenport, filed a petition this week asking the justices to decide whether states can regulate sports-related contracts sold on prediction markets like Kalshi. The move follows an April ruling from the US Court of Appeals for the 3rd Circuit, which found that Kalshi's sports contracts meet the legal definition of "swaps." That classification hands exclusive oversight to the Commodity Futures Trading Commission rather than state gambling regulators. Davenport said Kalshi "claims to offer legal sports betting in all 50 states" while refusing to follow the gambling laws of any of them.
The case matters well beyond New Jersey. Kalshi has built much of its sports-betting business on the swaps classification, letting it operate in states where licensed sportsbooks must register and pay taxes. If the Supreme Court takes the case and sides with New Jersey, prediction markets could suddenly face the same state-by-state approval process as any traditional bookmaker.
For now, Kalshi gets to keep calling its bets "event contracts," a label that has held up in federal court even if it convinces no one placing money on the Super Bowl.