[Live] CFTC Notes Kalshi ‘Insider’ Investigations

After Kalshi revealed the results of two insider trading investigations, the Commodity Futures Trading Commission (CFTC) issued an advisory on the cases Wednesday.

It said the politician who bet on himself “potentially violated” Commodity Exchange Act (CEA) rules about market manipulation, while the employee for a YouTube channel – reportedly an editor for MrBeast – “potentially violated” rules around trading based on insider knowledge in breach of a pre-existing duty.

The Commission did not say whether it was taking any action, but it said it “has full authority to police illegal trading practices occurring on any DCM, including those described above related to prediction markets.”

Kalshi revealed Wednesday it has fined and temporarily banned two users for violating its insider-trading rules, the first time it has publicly revealed the results of investigations.

The prediction market announced the disciplinary actions via a press release.

The first case “concerns a candidate who traded about $200 on his own candidacy for governor of California, then posted about it on social media.” Kalshi said the trades occurred in May. Kalshi’s announcement did not name the candidate, but that month, longshot Kyle Langford bet on himself to be governor of California.

The user was banned for five years and will pay a financial penalty 10 times the bet size, or $2,000.

The second case was “an insider who traded about $4,000 on YouTube streaming markets.” This user will be banned for two years and receive a financial penalty five times the initial bet size, or $20,000.

“In both of these cases, our systems flagged the trades and our surveillance team froze the traders’ accounts,” Kalshi said. “Neither trader withdrew any profits. These penalties are not indicative of future penalties — everything depends on the case, including amount traded and rules violated.”

Kalshi also reported both cases to the Commodity Futures Trading Commission (CFTC), though from the details provided, it is not clear whether they would violate the CFTC’s own intentionally narrow, insider-trading rules.

Fanatics has reportedly agreed to terms to buy an exchange of its own, and its founder Michael Rubin and CEO for Betting and Gaming Matt King both invested in Kalshi, according to a court filing in a case concerning the company’s attempt to stop Chief Business Officer Ari Borod from leaving Fanatics for Polymarket.

Polymarket announced Thursday that it had hired Borod from Fanatics, but a lawsuit filed in Florida shed some light on details behind the scenes. Details of the lawsuit were first reported by Front Office Sports.

After Borod agreed to leave Fanatics, the operator sued him in a Florida court on Jan. 12, arguing that he had violated a noncompete agreement by moving to a competitor.

Fanatics’ complaint was filed under seal, but a Jan. 29 response from Borod, where he makes the case that Polymarket is not a direct competitor to Fanatics, is public.

That filing contains a number of notable claims about Fanatics’ involvement in the world of prediction markets. It says that Borod was of the understanding that Rubin and King had invested in Kalshi before the launch of Fanatics Markets.

In addition, it says a team at Fanatics has agreed to purchase a designated contract market (DCM), which would allow it to run its own exchange rather than directing customers to contracts made available on an existing exchange. Fanatics Markets currently directs customers to Crypto.com’s contracts. The filing suggests that Fanatics had revealed its deal with an existing DCM in its initial complaint.

“I was genuinely unaware, prior to this lawsuit, that FMX had agreed to terms with a target exchange,” the filing said. “To date, I still do not know the principal financial and commercial terms of the deal, or the name of the target exchange.”

Filings show that Fanatics and Borod agreed earlier this month to settle the lawsuit.

A Fanatics spokesperson told InGame: “The parties have reached an out-of-court resolution of their dispute and have no further comment.”

Novig on Wednesday announced the close of a $75 million Series B investment round, a month after the sweepstakes-based, peer-to-peer, betting exchange applied to become a designated contract market (DCM) with the Commodity Futures Trading Commission.

The investment round was led by Pantera Capital, according to a release, with further support from Multicoin Capital, Makers Fund, Edge Equity, and existing investors Forerunner, Perceptive Ventures, and NFX.

Novig has now raised in excess of $105 million after proclaiming a tenfold trading-volume increase in 2025. The company claims an annualized trading volume of more than $4 billion, with the majority coming on sports events contracts.

“Novig is proving that prediction markets can fundamentally reshape sports betting by removing the exploitative middleman,” Paul Veradittakit, managing partner at Pantera Capital, said in a release. “Their peer-to-peer exchange delivers what traditional sportsbooks can’t: better odds, fairer market structure, and alignment between platform success and user profitability. When 23% of users are profitable compared to 2% on traditional platforms, it’s clear this is a foundational change to the industry. We’re excited to lead this round and support Jacob, Kelechi, and the team as they build a sports prediction market that actually puts bettors first.”

The U.S. Court of Appeals for the Ninth Circuit on Tuesday denied Kalshi an administrative stay that would have allowed the prediction market to keep offering sports contracts in Nevada, though it may still be able to remain active if it receives a regular stay.

An administrative stay is a short-term order to pause enforcement while a court considers a regular motion for a stay.

On social media site X, Andrew Kim, a Partner at Goodwin Law who has followed the various prediction market litigations but is not directly involved, wrote that it was too soon to comment on the significance of the decision because Kalshi’s main motion for a stay is still pending.

“Until the Ninth Circuit acts on the main stay motion, it’s hard to tell what, if anything, to make of this,” he wrote. “Could be that the panel just thought the administrative stay was unnecessary, in light of whatever it’s going to say about the main motion.”

Kalshi is seeking a stay from the Ninth Circuit after the U.S. District Court for the District of Nevada dissolved a previously granted injunction that had prevented the state of Nevada from enforcing a cease-and-desist against the business.

Also in the Ninth Circuit, the Commodity Futures Trading Commission (CFTC) today filed an amicus brief in support of Crypto.com, which was denied a similar injunction last year, according to a social media video from CFTC Chair Michael Selig. That brief is likely to appear on the public docket for the case tonight.

Officials in both the Netherlands and New Zealand this week announced that prediction markets constitute illegal gambling according to local laws.

The gaming authority Kansspelautoriteit (‘KSA’) in the Netherlands said Tuesday that if Polymarket did not cease activity there, regulators would impose a penalty payment of €420,000 ($498,000) per week, with a maximum of €840,000. In New Zealand, regulators are taking a lighter touch at the moment.

“We prioritize contacting websites that actively market themselves to New Zealanders, or which have conspicuous New Zealand elements on their sites (e.g. pre-populating sign-up forms with New Zealand as country of origin and setting the default currency to NZD),” Department of Internal Affairs gambling director Vicki Scott told Newsroom. “Neither Kalshi or Polymarket do that. However, we intend to send them a notification for the sake of clarity.”

The website added that Kalshi has added New Zealand to its list of blocked countries as of Tuesday, while it is unclear if Polymarket has taken the same action.

Ella Seijsener, director of permits and supervision at the KSA, said: “Prediction markets are on the rise, also in the Netherlands. This type of business offers bets that are not allowed in our market anyway, not even by licensees. In addition to the social dangers of this type of prediction (e.g. the possible influence of elections), we find that this is illegal gambling. Those who do not have a license from the KSA have nothing to do with our market. The same goes for these kinds of new gambling platforms.”

Regulators in about 33 jurisdictions across the world have banned Polymarket, while Kalshi has self-blocked in roughly 50, and their maps overlapping substantially. Both companies are currently restricted in Australia, Belgium, Canada, France, Italy, Poland, Singapore, and the United Kingdom.

Commodity Futures Trading Commission (CFTC) Chair Michael Selig defended the CFTC’s jurisdiction over prediction markets in a new social media video and said the regulator had filed an amicus brief arguing that states do not have the authority to regulate the products.

In a video posted to social media site X Tuesday, Selig said that the regulator has filed a “friend of the court,” or amicus curiae, brief “to defend its exclusive jurisdiction over these derivative markets.”

“To those who wish to challenge us in this space, let me be clear — we will see you in court,” Selig said.

On Monday, the CFTC chair penned an op-ed in the Wall Street Journal outlining a similar sentiment. In that op-ed, he said the amicus brief would be filed in Crypto.com’s lawsuit against Nevada in the U.S. Court of Appeals for the Ninth Circuit. That appeals court case followed a judge’s decision to deny the business an injunction that would have allowed it to keep offering sports contracts in the state of Nevada. The amicus brief is not yet available on the public docket for the case.

Selig’s video does not specifically mention sports event contracts — which have been the subject of all the state lawsuits — at any point. Instead, he referenced contracts on weather and current events.

Last month, Selig said the CFTC would make its voice heard in prediction market lawsuits.

Update: Utah Governor Spencer Cox publicly responded to Selig’s challenge, and he did not mince words.

DraftKings CEO Jason Robins says the company’s sportsbook offering is not being cannibalized by prediction markets at this point.

In his letter to shareholders accompanying DraftKings’ annual results Thursday, he noted that adoption was high in Missouri, which launched legal sports betting in December, despite the rise of prediction markets.

“To date, we are not seeing a discernible impact from Predictions on our revenue,” Robins wrote. “In our newest Sportsbook state, Missouri, adoption of our offering was higher than in any state launch in our history through the first two months, and activity per customer has been strong. 

“In the fourth quarter, our overall Sportsbook handle growth accelerated to 13% year-over-year. In January, our Sportsbook handle increased 4% year-over-year, even after two consecutive months of sportsbook-friendly outcomes and as our parlay handle mix continued to surge.”

Robins also backed Commodity Futures Trading Commission (CFTC) Chair Michael Selig’s plan, announced last month, to write new event contract rules.

“We support the CFTC’s engagement on event contracts and the advancement of a more defined and durable regulatory framework,” he wrote. “The CFTC Chair recently directed agency staff to establish clear standards for event contracts to provide certainty for market participants. We view this direction as constructive.

“Clear rules should reward operators with strong compliance and responsible engagement infrastructure, and support the expansion of sports-related Predictions over time.”

DraftKings CEO Jason Robins said Thursday that the business is going to spend big on acquiring customers for its prediction market, and that the vertical will generate “hundreds of millions in annual revenue” in the years ahead.

In a letter to shareholders accompanying DraftKings’ annual results, Robins said the company was going to “deploy growth capital” in the space, but did not reveal how much it would spend. Last year, FanDuel owner Flutter Entertainment said it expected to post a $200 million loss from its own prediction market in 2026, suggesting its spending would be well above the $200 million mark.

“Predictions is rapidly developing into a massive, incremental opportunity, and we are moving with urgency,” Robins wrote. “We expect to emerge as the leader in this nascent category. 

“We plan to deploy growth capital to build the best customer experience in Predictions and acquire millions of customers. This year, we anticipate significant step-function improvements to our Predictions offering including the integration of Railbird and launch of our market-making division. 

“We are targeting hundreds of millions in annual revenue for DraftKings Predictions in the years ahead, and we believe there is much more upside over the long-term.”

He added, however, that the company is still months away from launching its fully-owned exchange, Railbird, which it bought in October. Currently, DraftKings’ prediction market offers users access to contracts from Crypto.com and CME instead. Robins said Railbird will go live “near the middle of this year.”

Robins added that DraftKings would offer parlays on its prediction market too at some point in the future.

“Over time, we also intend to introduce exclusive combination trading options that may become a major differentiator as the customer experience evolves,” he wrote.

Robins also confirmed that DraftKings will start making markets on both its own exchange and others. InGame reported last week that DraftKings was hiring for this team.

Israeli authorities have arrested two people for allegedly making bets on Polymarket using “classified information.”

The Israeli Defense Ministry (IDF), police, and the Shin Bet domestic security agency issued a joint statement saying that two people — an army reservist and a civilian — had been arrested in connection with bets placed on Polymarket.

The bets concerned “the occurrence of military operations, based on classified information to which the reservists were exposed as part of their military duties.”

The statement added that insider bets based on classified information create “a real security risk to IDF activities and state security.”

The insider bets in question were not identified, but in June of last year observers noted a number of suspicious bets related to Israeli military activity. Israel’s Public Broadcasting Corporation noted last month that one account had made a profit of around $150,000 by betting on markets such as “Israel military action against Iran before Friday?” and “Israel strike on Iran on June 24?”

The identities of those involved cannot be revealed due to a gag order.

In his Secure Stakes newsletter, security and sports integrity expert Matthew Wein noted that he believed this to be “the first case in the world of someone being charged criminally for insider trading on a prediction market.”

Behold, some evidence via Dustin Gouker of the launch of “MyBookie Predictions,” located in Costa Rica and serving (illegally) customers across the United States.

Apparently, the company is co-opting the lexicon of prediction markets — if it is not going further and seeking a DCM license via the Commodity Futures Trading Commission to operate within the the U.S. Given the agency’s current laissez-faire posture around sports events contracts, I would not entirely eliminate the possibility of MyBookie Predictions gaining entry stateside.

The National Council of Problem Gambling (NCPG) has called on prediction market operators to promote its National Problem Gambling Helpline.

In a resolution published Monday, the NCPG noted, “The buying and selling of futures contracts via prediction markets carries substantially similar levels of risk to the consumer as traditional sports betting, including risks associated with chasing losses, impulsive behavior, financial harm, and the development or escalation of gambling-related harm.”

It added that prediction market users “may not recognize their activity as functionally gambling.”

As a result, it called on prediction market operators to include “clear, prominent, and ongoing promotion,” of the National Problem Gambling Helpline.

The NCPG launched its new helpline number, 1-800-MY-RESET, last month, after it lost the rights to 1-800-GAMBLER last year.

House Rep. Dina Titus tweeted Tuesday that she introduced a bill that would ban CFTC-registered sports event contracts from offering contracts on sports or casino gaming.

In a post on social media site X, she said the bill – the Fair Markets and Sports Integrity Act – would prevent prediction markets from being able to “circumvent state gaming laws.”

Kalshi set a new single-day record for trading volume and fees taken in on Super Bowl Sunday.

The total amount traded on the day came to $870 million, easily breaking the previous record of $543 million set during the conference championship games.

Kalshi made around $7.7 million in taker fees on the day of the game.

In total, just over $500 million was traded on the Super Bowl winner market, though this included more than $300 million traded before the day of the game. The market was open through the entire NFL season.

Markets on the Super Bowl halftime show also combined for well over $100 million in volume, with tens of millions staked on ads during the game.

Add one more to the legal docket. Polymarket has filed a federal lawsuit against Massachusetts after the state moved to enforce its sports gambling laws against other prediction-market platforms, following a ban on Kalshi’s sports event contracts.

Although Polymarket is not yet fully live in the U.S. as it remains in a beta phase, only available to members being rolled off a waitlist, the platform argues that it faces imminent enforcement and penalties. It says federal regulation of derivatives, via the Commodity Exchange Act and Commodity Futures Trading Commission, should preempt state action.

“Polymarket US now faces a real and imminent risk of identical enforcement, exposing it to civil penalties, potential criminal liability, forced cessation of operations within Massachusetts, and severe collateral consequences to its nationwide operations,” the company says in the lawsuit.

But Massachusetts officials have been on the offensive to this point. Last Friday after a judge denied Kalshi’s motion for a stay in a similar dispute initiated by the state, Attorney General Andrea Joy Campbell said:

“Today’s court order affirms Massachusetts’ right to enforce our gambling laws and hold all operators who wish to offer sports wagers in in our state accountable. Massachusetts is the first state to prevail in these legal claims against Kalshi, and we will continue to work to mitigate the serious public health consequences associated with unregulated gambling.”

DraftKings will offer access to Crypto.com’s event contracts, as it expands its prediction market offerings, the company announced Friday.

DraftKings Predictions previously only offered access to contracts offered by commodities giant CME, which also offers FanDuel contracts. DraftKings is registered as a broker, which allows it to partner with registered exchanges.

As part of the partnership, DraftKings Predictions will offer player props for the first time. Other new markets include soccer, MMA, golf, boxing, tennis, and the Winter Olympics.

“We’re continuing to build momentum behind DraftKings Predictions by leveraging our expertise across sports and technology and integrating additional CFTC-regulated exchanges like Crypto.com,” DraftKings Predictions Senior Vice President and General Manager Jeanine Hightower-Sellitto said. “This collaboration meaningfully expands customer access to trade on sports and a broader range of prediction markets and also reinforces our focus on delivering a more comprehensive and engaging experience as the product continues to evolve.”

DraftKings also bought Railbird Exchange in October, and is expected to launch its contracts in the “coming months.”

DraftKings Predictions is available in 38 states, with sports contracts in 17 states.

Kairos, which founders Jay Malavia and Zayd Alzein envision as a trading terminal for savvy patrons of multiple prediction markets, announced a $2.5 million capital raise backed by a16z crypto on Tuesday.

Geneva Trading, the University of Illinois, and other angel investors led the seed round, according to Fortune.

Kairos, which is currently in beta phase, will integrate offerings from Kalshi and Polymarket, the dominant players in the United States prediction market environment.

“This is the opportune time to reshape an industry and give the power back to the people,” Malavia told Fortune. “In trading, it is all about the right time.”

Two-time NBA MVP Giannis Antetokounmpo is now a Kalshi shareholder. The Milwaukee Bucks star posted a message on social media site X Friday revealing that he was now a shareholder in the business.

It is not clear whether the investment comes as part of a larger funding round.

Antetokounmpo is the first athlete in a major U.S. league known to have a stake in Kalshi. NFL running back Saquon Barkley is an investor in rival Polymarket.

Fantasy sports platform Sleeper has unveiled a new partnership with Kalshi, further expanding Kalshi’s reach while putting Sleeper on the prediction market train. Sleeper in 2025 had sued the CFTC for allegedly stalling on its application to become a futures commission merchant with the National Futures Association. Eventually, on Jan. 14, its application was approved, and now this partnership will crystallize just in time for the Super Bowl.

A high-ranking executive at a leading regulated online sportsbook is reportedly on the move to a leading prediction market operator, the latest sign of the changing times in U.S. sports betting.

Front Office Sports wrote Monday that Fanatics Chief Business Officer Ari Borod is headed to Polymarket in an “executive role.” Neither Fanatics nor Polymarket were willing to give a comment to Front Office Sports, and, reached by InGame on Thursday, Borod also declined to comment at this time. But, as Eilers & Krejcik noted in a Thursday morning newsletter, Borod is no longer listed on the “leadership” page on Fanatics’ website, a strong suggestion that he has indeed left the company.

Borod has been with Fanatics Betting & Gaming since 2021, and prior to that, served as an executive at FanDuel and then at The Action Network.

Oral arguments in Kalshi’s Fourth Circuit appeal against the state of Maryland won’t take place until May, almost nine months after the appeal was filed.

The hearing will take place at some point between May 5 and May 8.

Kalshi is appealing the U.S. District Court for the District of Nevada’s decision not to grant the business an injunction that would have prevented it from enforcing a cease-and-desist against the business.

The Fourth Circuit was the second circuit court to hear an appeal involving Kalshi, after the decision by the U.S. District Court for the District of New Jersey was appealed to the Third Circuit.

However, the Fourth Circuit hearing will take place after oral arguments in the Ninth Circuit, where Kalshi is appealing a decision by the U.S. District Court for the District of Nevada to dissolve an injunction that Kalshi had previously won.

Many legal commentators expect lawsuits over sports event contracts to eventually reach the Supreme Court, but that court usually doesn’t take a case unless two circuit courts disagree.

Financial trading app Plus500 will offer its users access to Kalshi’s prediction markets, the business announced Tuesday.

In a filing to the London Stock Exchange, Plus500 said its U.S. arm would offer contracts on “economic indicators, financial events, geopolitical developments and other measurable real-world outcomes.” It did not mention sports.

“Leveraging the Group’s proprietary technology, established clearing capabilities and advanced risk-management infrastructure, the new offering provides US retail customers with a transparent and accessible way to engage in event-based trading,” the announcement said.

The announcement boosted Plus500’s share price by 6.7% on a day where most stocks were down, adding £214 million ($293 million) to the company’s market cap, as of market close in London on Tuesday.

Plus500 also provides clearing services — moving money and handling paperwork behind the scenes for the actual buying and selling of contracts — for CME’s prediction market.

Crypto.com will allow prediction market traders to make trades on margin, allowing users to bet more than they deposit, via a new predictions-only app, the business announced via press release Tuesday.

The exchange is launching OG, a new app that is focused on predictions, with contracts on sports as well as financial, political, cultural, and entertainment events. 

The app will also allow users to trade on margin. It would be the first prediction market to allow this feature.

In margined trading, a trader borrows funds from a broker to purchase an asset. By betting on margin, traders can be exposed to higher payouts, but also are at risk of greater losses.

“OG also plans to provide access to CDNA’s margin prediction contracts offering through Crypto.com’s federally licensed futures commission merchant,” the press release said. “This will be the first prediction markets platform to offer margin trading.”

The business submitted a proposed rule change to the CFTC concerning users’ position limits Monday. That rule change, which appears to be necessary to allow margined trading, is subject to a 10-working-day review.

New York State Attorney General Letitia James sent a message on social media warning residents of the state against using prediction markets.

On social media site X, James wrote that prediction markets offering sports wagering violated New York’s gambling laws.

In October, Kalshi sued New York after the state sent a cease-and-desist order to the prediction market.

Today, Kalshi is running a promotion in New York, offering to give away $50 of groceries to each customer at a Manhattan grocery store.

Scottsdale, Arizona-based Xchange Alpha LLC was granted designated contract market (DCM) status on Monday by the Commodity Futures Trading Commission (CFTC).

The process was a brisk one for Xchange Alpha — 204 days — as other companies like Railbird waited more than three years.

As a DCM, Xchange Alpha is licensed to offer the same type of exchanges as competitors Kalshi and Polymarket.

Bella Rozenberg, a senior counsel for Xchange Alpha, said in a LinkedIn post Monday that “As a fully intermediated futures exchange, we will list traditionally structured futures contracts. We anticipate launching in late summer 2026.”

The post did not reference sports events contracts.

Kalshi’s contracts on Super Bowl advertisements have raised new questions about potential insider trading on the platform.

As of Monday morning, users had staked more than $2 million on a market named “Which brands will advertise during the Big Game 2026?” featuring companies like OpenAI, Netflix, and Allstate. Another market asks, “Who will appear in a big game ad before Feb 9, 2026?” with options including celebrities such as Tom Brady, Timothee Chalamet, and Snoop Dogg. That market has been much less active, with around $16,000 in volume.

CNBC noted that these markets, like many that have appeared on prediction markets in recent months, could have an especially high risk of insider trading. “There are likely hundreds, if not thousands, of employees who know whether their company is planning to run a Super Bowl commercial,” CNBC Sport newsletter’s Alex Sherman wrote.

Insider trading on prediction markets is technically allowed by the CFTC in many circumstances, though Kalshi’s house rules prohibit all forms of trading with material non-public information. 

Prediction markets themselves are not allowed to advertise during the Super Bowl, as the products appear on the NFL’s “prohibited list,” according to Front Office Sports.

Kalshi often publishes a list of “trading prohibitions” — people who would be banned from trading, typically due to their roles giving them potential access to material non-public information — for contracts, but its rules for the two Super Bowl advertisement contracts do not include prohibitions. 

Coinbase has launched its prediction market offering, offering users access to Kalshi’s event contracts.

Coinbase’s prediction market, which went live Wednesday, offers trading on sports events like the Super Bowl and NBA games, including point spreads and prop bets, as well as non-sports events like the next Federal Reserve chair.

The crypto trading app had long been expected to get involved with prediction markets before it announced a partnership with Kalshi in December. Immediately after announcing that deal, the business sued authorities in Connecticut, Michigan, and Illinois.

Coinbase acts as a futures commission merchant (FCM), meaning that it allows users to buy and sell contracts from a designated contract market (DCM) like Kalshi and receives commission for doing so.

The Coalition for Prediction Markets, led by Kalshi and Crypto.com, and including Coinbase, Robinhood, and Underdog, unveiled a full-page ad in The Washington Post on Wednesday to underscore some distinctions between regulated and unregulated prediction market platforms.

And there will be a lot more where this comes from. Per Business Insider, quoting a spokeperson for the group, “the coalition plans to spend seven figures in the coming months in coordination with its government relations outreach.”

The coalition was announced in December 2025 and has turned its attention to the issue of insider trading in response to alarm about a new trader on Polymarket (not yet a part of this trade group) who invested $30,000 into a market involving the potential capture of since-captured Venezuelan President Nicolás Maduro, shortly before he was indeed detained by U.S. forces. The identify of this trader is not (yet) publicly known.

In response to that trade, which gained substantial mainstream and social media attention, Congressman Ritchie Torres (NY-15) introduced H.R. 7004 with 39 co-sponsors, the Public Integrity in Financial Prediction Markets Act of 2026.

The scope of the bill, which now resides in the Committee on Oversight and Government Reform, is somewhat limited, though, applying to “an elected official of the Federal Government; a political appointee [or] an employee of an Executive agency.” That would mean it still wouldn’t apply to other individuals who might also have insider knowledge but do not work directly for the federal government.

Meanwhile, all prediction markets registered with the Commodity Futures Trade Commission (CFTC) include house rules that prohibit the use of “material non-public information” to trade. However, as InGame’s Daniel O’Boyle noted previously: “These are all house rules, with the CFTC’s own rules on insider trading being narrow by design. Trading with material non-public information is permitted by the regulator, as long as that information was obtained legally and the market isn’t being manipulated.”

The judge in the lawsuit between Massachusetts and Kalshi says that any injunction against the prediction market should include at least a 30-day grace period to allow it to set up geolocation services.

However, he did not give any indication of whether he might grant Kalshi a stay that would prevent the injunction from going into effect.

Judge Christopher Barry-Smith wrote an order Tuesday explaining his “preliminary views” on the “contours” of the injunction against Kalshi, which he granted earlier this month.

One key decision the judge says he intends on taking is allowing a 30-day period for the injunction to take effect. Massachusetts’ proposed injunction had called for a seven-day period, while Kalshi asked for 90 days.

With a 30-day pause, Kalshi would remain active in Massachusetts until at least March.

The judge also said Kalshi must use technology, such as geolocation, to block all users located in Massachusetts from placing sports bets, rather than simply using users’ residency information. Kalshi uses residency information to block users living in certain countries from accessing its platform, meaning that U.S. users within those countries can still trade.

Barry-Smith added that users in Massachusetts should be allowed to trade out of their active bets, but should not be allowed to add to them.

He also said the injunction would not need to ban Kalshi from marketing itself nationally, as banning users within the state from buying sports event contracts should mean that this marketing would not cause any users in the state to participate in trading the contracts.

Both parties will submit their arguments on whether Kalshi should get a stay by Feb. 4, after which the judge will make a decision on that matter.

Major League Soccer (MLS) has become the latest sports league to partner with a prediction market, signing a partnership deal with Polymarket.

Polymarket will be an “official partner” of MLS, and the deal will include “new fan experiences” that are intended to increase “second-screen engagement” for fans.

The agreement also includes independent monitoring of Polymarket trading activities in order to “protect the integrity” of matches. The deal also applies to the Leagues Cup, a competition between MLS teams and clubs from Mexico’s Liga MX.

MLS followed the NHL in partnering with a prediction market. The NHL partnered with both Kalshi and Polymarket last year.

“As soccer’s audience continues to grow and evolve in the U.S., fans are looking for new ways to engage more deeply with the game,” Polymarket founder and CEO Shayne Coplan said in a press release. “Through our partnership with MLS and Leagues Cup, we can surface real-time collective sentiment around key moments, matches, and season-long storylines, giving fans a more interactive, data-driven way to experience the game and engage with the world’s most popular sport.” 

Polymarket has upped its fees for its U.S. site, though they still remain much lower than the competition.

A rulebook update filing with the Commodity Futures Trading Commission (CFTC) shows that Polymarket U.S. will now charge one cent in fees for every $10 staked, up from one cent in fees for every $100 staked.

The new fee works out as 0.1% of the amount staked. 

Even with this tenfold increase, those fees are much lower than such rivals as Kalshi or Crypto.com. Kalshi’s fees vary depending on the odds, but average out at around 1.2%. Crypto.com effectively charges a flat 2% fee for most contracts. Sportsbooks have generally held between 7% and 12% of stakes during 2025.

Because the price is based on the amount staked, rather than the number of contracts purchased, the fee per contract changes, depending on the odds at which the contract is traded. For example, the fee to buy 100 contracts at five cents each is lower than the fee to buy 100 contracts at 10 cents each. This avoids distortions for contracts purchased at extremely long or short odds.

Polymarket U.S. is still not available to all customers and is instead rolling users off of a waitlist. A date for a full launch has not yet been announced.

Last week, Polymarket put fees on its global site for the first time, though only on 15-minute cryptocurrency price markets. On those fast-moving markets, activity is often driven by trading bots.

Schwab CEO Rick Wurster told Bloomberg Businessweek Daily on Jan. 22 that he is amenable to the financial-services firm eventually launching a prediction market as a hedging tool, but would not support a foray into sports event contracts.

“We’ll leave the sports gambling … to the gambling houses — to the FanDuels, the DraftKings and the Robinhoods,” he said.

Wurster said he sees a distinction between prediction markets and gambling. His view has been consistent and clear. At the Schwab IMPACT conference in Denver in November, he said, “I hope as an industry, we’re able to tell the story to clients about the difference between gambling and investing. I just don’t want young people in our country that think that betting on the Monday Night Football game is equivalent to being invested for the long term in stocks and bonds.”

A Massachusetts judge who was set to decide on whether to let an injunction banning Kalshi from the state come into effect instead kicked the can down the road Friday, seemingly ensuring that the prediction market will remain available in the Commonwealth until after the Super Bowl.

The hearing Friday followed a decision on Tuesday to grant an injunction that would have banned Kalshi from offering sports event contracts in the state. In the Friday hearing, Judge Christopher Barry-Smith was set to decide whether to grant Kalshi a stay to prevent enforcement of the injunction. 

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Kalshi on Friday morning filed for an emergency stay that would allow the prediction market to keep offering sports event contracts in Massachusetts.

The Superior Court for Suffolk County in Massachusetts approved an injunction on Tuesday that would ban Kalshi’s sports contracts from the state. The court will decide whether to issue the stay during a hearing at 12 p.m. ET Friday. If not, the injunction will go into effect once the meeting ends.

Kalshi is also seeking a stay from the Massachusetts Appeals Court. The emergency stay would take effect until the Appeals Court makes its own decision.

Massachusetts is the first state to issue an injunction to ban Kalshi’s sports event contracts from its jurisdiction. In two other states – Nevada and Maryland – courts have denied Kalshi injunctions that would have prevented those states from enforcing cease-and-desist letters, but Kalshi appealed both of those decisions and remains active in both states while courts consider those appeals.

On Tuesday, Robinhood, which offers access to Kalshi contracts, filed for an order in federal court to prevent Massachusetts from enforcing the planned injunction against its business as well.

As legal tensions flare in multiple jurisdictions between state regulators and the leading prediction market platforms, a new bill in Iowa has emerged that would authorize the state’s department of revenue to oversee — and tax — event contracts on those platforms.

The bill is Senate File SF2085 and it would require operators to obtain a permit and pay a fee of $10 million. It would also levy a tax on operator adjusted revenues on event contracts including: “sporting activities, elections, legislative actions, and economic indicators.” That 20% rate stands out against the existing 6.75% applicable to gross revenue for sports betting licensees.

On balance, this bill cuts to the heart of the prediction market debate with questions around federalism, preemption, and state sovereignty. Does Iowa, New York, or any state have authority to regulate this activity, which is also regulated at the federal level via the Commodity Futures Trading Commission and the Commodity Exchange Act?

That is ultimately the question that stakeholders are debating in the multitude of lawsuits underway, including in Massachusetts, where Attorney General Andrea Campbell sued Kalshi, arguing that it was flouting state law with certain contracts. So far, Campbell has won a preliminary injunction, effective on Friday.

Wrote Superior Court Justice Christopher Barry-Smith in the order:

“Rather, consistent with its litigation strategy in other states that have challenged its operation, Kalshi argues that the Commonwealth’s attempt to regulate its exchange through the state’s Sports Wagering Law is preempted by federal law. As explained below, I disagree.”

In a thread on social media site X, CFTC chair Michael Selig talked about his goals to “future proof” the agency.

He also directly mentioned prediction markets for the first time in public comments since taking the role.

When granting an injunction to ban Kalshi from the state, a Massachusetts judge cited arguments that resembled prior decisions against the prediction market in federal lawsuits.

Suffolk County Superior Court Judge Barry-Smith said the Commodity Exchange Act did indeed preempt state law, but only in the field of futures trading. The preemption, he said, did not extend to state wagering laws.

“While it would make sense for Congress to displace a state’s targeted attempt to regulate a derivative market, for example, or to clarify the roles of separate federal agencies [..] that logic does not suggest Congress intended to displace traditional state police powers, such as gambling regulation – particularly in the absence of the express language so stating,” he wrote.

He also noted that the CEA does specifically say that state gaming laws are preempted for certain types of contracts, but Kalshi’s contracts do not fall under any of the types of contract listed in that passage.

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How much is Tuesday’s Massachusetts injunction decision worth to FanDuel and DraftKings? Maybe somewhere around a combined $1.2 billion, according to share price moves.

Both companies had started the day down significantly, thanks to a combination of factors including wider uncertainty across the entire stock market, sports results over the weekend, and the continued rise of prediction markets, but shares jumped as news of the court decision came out.

At 11:30 a.m. ET, before news of the Massachusetts decision was public, DraftKings shares were trading at $31.40. Just 10 minutes later, they rose to $32.73, slightly higher than their closing price Friday. That’s a rise of 4.2%, adding more than $650 million to the company’s market cap.

Shares in FanDuel owner Flutter also rose during the same 10-minute period, by 1.8% to $185.60. That would suggest an increase in value of around $580 million. As Flutter is a larger global business, U.S. events usually have a less dramatic effect on its share price than that of DraftKings.

However, shares in both companies quickly slipped back off their highs. As of 2:15 p.m. ET, DraftKings was trading at $32.02 and Flutter at $184.00.

A state court in Massachusetts granted an injunction Tuesday morning that will block Kalshi from operating in the state.

Massachusetts Attorney General Andrea Campbell sued Kalshi in September, the first time a state had sued Kalshi in state court, and requested an injunction to block the platform. Following a hearing in December, that injunction has been granted.

The order reads:

“For the forgoing reasons, the Commonwealth’s motion for a preliminary injunction is ALLOWED. Kalshi’s motion to dismiss is DENIED.

“The Commonwealth is entitled to a preliminary injunction prohibiting Kalshi from offering sport-related event contracts in the absence of the required license under the Sports Wagering Law. At the hearing both parties discussed, but did not resolve, certain details of the Commonwealth’s requested injunction, including how to prohibit new contracts without impacting already existing contracts. 

“For that reason, I will enter a preliminary injunction consistent with this decision on the following schedule: i) not later than January 21, 2026 at 4:00 p.m the Commonwealth shall submit a proposed preliminary injunction consistent with this decision; ii) not later than January 23, 2026 at 10:00 a.m, Kalshi may submit a response to the Commonwealth’s proposed order; iii) if either side requests to be heard or if I determine a hearing is necessary, a hearing will take place on Friday, January 23, at 12:00 noon, after which I will enter a preliminary injunction. Any motion to stay may also be raised in this time period. If both parties wish to confer with respect to the terms of the preliminary injunction and request to extend these deadlines, they may notify the clerk and I will respond promptly to any such joint request. SO ORDERED.”

New Commodity Futures Trading Commission (CFTC) Chair Michael Selig has appointed two former colleagues to assist in his running of the agency that regulates prediction markets.

Michael Passalacqua and Cal Mitchell will both be senior advisors to Selig, the CFTC announced via press release Tuesday.

Before joining the CFTC, Passalacqua was a lawyer working for Simpson Thacher & Bartlett LLP, where he focused on cryptocurrency regulation. He previously worked at Wilkie, Farr & Gallagher, alongside Selig, from 2022 until 2025.

Mitchell was previously a special advisor in the Office of Legislative Affairs at the U.S. Department of the Treasury. He had also been a personal aide to Sen. Bill Hagerty. Selig had worked at the Treasury from January up until his appointment to lead the CFTC.

Selig is currently the only commissioner at the CFTC, which typically operates with five commissioners.

DRW, one of the biggest market makers in traditional commodity trading, is hiring for a “dedicated prediction markets desk,” according to a report.

The Financial Times reported Wednesday that DRW is looking for a trader who will be paid a base salary of up to $200,000 to “monitor and trade active markets in real time” on Polymarket and Kalshi, as part of a “dedicated prediction markets desk.” The report added that “strict risk controls” would mean these businesses would probably be less likely to place “direct bets” on specific outcomes and more likely to arbitrage between different markets.

In a podcast appearance in September, DRW founder Don Wilson said sports contracts were “not necessarily a natural fit, but I don’t necessarily have a religious opposition to it.”

DRW would join rivals Susquehanna International Group and Jump Trading in getting involved in prediction markets.

The posting follows Goldman Sachs CEO David Solomon saying on Thursday that his business has a team “looking at” prediction markets.

High Roller Technologies has become the first primarily online casino business to get into the world of prediction markets, through a partnership with Crypto.com, the business announced via press release Wednesday.

Like other deals involving Crypto.com, High Roller will act as a technology service provider to the business, rather than being registered with the National Futures Association as a futures commission merchant or introducing broker.

High Roller Technologies operates the brands High Roller and Fruta. Neither site is currently active in the U.S. The High Roller website currently teases the prediction market offering, reading, “Trade on outcomes. Roll with us. A market-based predictions app developed in collaboration with High Roller Technologies and Crypto.com. Built around data, probabilities, and responsible play.”

“We’re thrilled to bring High Roller to the USA through this strategic partnership with Crypto.com,” High Roller CEO Seth Young said. “Pairing the massive appeal of prediction markets with our strong distribution capabilities is an incredibly exciting opportunity, and we’re looking forward to introducing our premium experience to consumers across the country.”

The product is expected to launch this quarter.

“Crypto.com is a leader in prediction markets and we are thrilled to expand access to event contracts through innovative partnerships, including with High Roller,” Crypto.com Global Head of Predictions Travis McGhee said.

High Roller is listed on the New York Stock Exchange. When the partnership was announced, its shares surged, by more than 900% to $33.68. That would value the business at more than $250 million.

The shares dipped from those highs and closed at $23.75 Thursday.

Investment banking giant Goldman Sachs has a team “looking at” prediction markets, Chief Executive David Solomon revealed.

Speaking on an earnings call Thursday, Solomon called prediction markets “super interesting,” and said he had met with “the two big prediction market companies,” likely referring to Kalshi and Polymarket.

“We have a team that are spending time with them and are looking at it,” he said. “I can certainly see opportunities where these cross into our business and we’re very focused on understanding that, understanding the regulatory structure, that’s going to develop around that.”

Solomon did not reveal whether Goldman would be looking more at trading or market making on prediction markets itself or to act as an intermediary that allows clients to make trades.

Ukraine banned Polymarket last month, accusing the prediction market platform of offering unlicensed gambling in the country.

An order issued by the country’s government in December banned 198 websites, mostly traditional online casino or sports betting sites, but Polymarket was also included on the list. Internet service providers in the country have been ordered to stop allowing customers to access the website.

Polymarket’s global site blocks customers from 33 countries, but not Ukraine. The site offers a number of contracts related to the War in Ukraine.

Kalshi’s terms and conditions already ban users from Ukraine, though the platform has allowed U.S. residents in blocked countries to place bets if “temporarily located” there.

FanDuel Predicts, the prediction market platform from FanDuel, expanded its U.S. footprint to 18 states on Wednesday, per a report from The Closing Line.

FanDuel Predicts, which is operated in partnership with derivatives marketplace CME Group, initially launched on Dec. 22 in just five states: Alabama, Alaska, North Dakota, South Carolina, and South Dakota.

This expansion adds some large — and controversial — population centers, including California, Georgia, Florida, and Texas. Of those, only Florida already allows legal sports betting, though limited in scope as only Hard Rock Bet from the Seminole Tribe is permitted to offer online sports wagering. Here is what a menu in Florida shows as of Wednesday afternoon:

The platform’s presence in California, in particular, seems likely to heighten tensions with tribal groups that believe prediction markets represent an encroachment on their gaming compacts with the state.

A draft of the text that gaming industry groups aim to insert into a bill in order to ban sports event contracts has emerged.

The American Gaming Association (AGA) and Indian Gaming Association (IGA) have been lobbying to amend a planned crypto market structure bill, currently under consideration with the House Agriculture Committee, to include language banning sports event contracts. Industry newsletter The Closing Line reported Tuesday the draft language that could be inserted into the bill.

The text is below:

SEC. XXX. PROHIBITION ON CERTAIN EVENT CONTRACTS INVOLVING SPORTS AND CASINO-STYLE GAMES.

(a) Amendment to the Commodity Exchange Act.—Section 5c(c)(5)(C) of the Commodity Exchange Act (7 U.S.C. 7a–2(c)(5)(C)) is amended by adding at the end the following:

“(v) Prohibition on Sporting and Casino-Style Event Contracts.—

(1) No agreement, contract, or transaction relating to any Sporting Event or Athletic Competition or any Casino-Style Game may be listed or made available for clearing or trading on or through a registered entity.

(2) In this section:

(A) The term ‘Sporting Event or Athletic Competition’ means any live or virtual contest involving physical activity or skill in which individuals or teams compete, and performance determines an outcome or statistical result, including amateur, collegiate, or professional sports.

(B) The term ‘Casino-Style Game’ means any game traditionally found in casinos, including but not limited to, slot machines, video poker, blackjack, roulette, craps, and other casino style-table games, bingo, lottery, or any simulation thereof.

(b) Effective Date.—The amendments made by this section shall apply to any agreement, contract, or transaction not approved by final written order of the Commission on or before the date of enactment.

The AGA and IGA Monday wrote a letter to representatives encouraging them to use the crypto market structure bill as an opportunity to ban sports event contracts.

While the two gaming industry groups argue that sports event contracts are already illegal, the language above would appear to remove any ambiguity by explicitly banning the contracts in federal law.

The crypto market structure bill, officially named the Digital Asset Market Clarity Act of 2025, mostly concerns regulation of cryptocurrency exchanges.

Two former congressmen will join prediction market lobbying group the Coalition for Prediction Markets.

Kalshi Head of Corporate Development Sara Slane posted on social media site X Tuesday morning that Sean Patrick Maloney and Patrick McHenry will both join the Coalition. 

Maloney represented New York’s 18th congressional district from 2013 to 2023, while McHenry represented North Carolina’s 10th congressional district from 2005 to 2025 and was speaker pro tempore of the House for three weeks in 2023.

Maloney served on the House Committee for Agriculture, which oversees the Commodity Futures Trading Commission (CFTC), while McHenry was chair of the Committee on Financial Services.

The Coalition for Prediction Markets was set up in December to lobby for platforms offering event contracts. Its members are Kalshi, Crypto.com, Coinbase, Robinhood, and Underdog.

Kalshi has filed its lawsuit against the state of Tennessee, after receiving a cease-and-desist letter from the state.

The case was docketed Monday, having been filed Friday, the same day that the prediction market received a cease-and-desist.

Like in other lawsuits, Kalshi argues that the state has no authority to shut down its sports event contracts, as it is subject to the “exclusive jurisdiction” of the Commodity Futures Trading Commission (CFTC).

“Kalshi is a federally designated derivatives exchange, subject to the CFTC’s exclusive jurisdiction. It offers consumers the chance to trade in many types of event contracts, including, as relevant here, sports-event contracts,” the filing says. “These contracts are subject to exclusive federal oversight, and—critically—they are lawful under federal law.”

The prediction market has asked for a preliminary injunction and temporary restraining order to prevent the state from enforcing its cease-and-desist until the full matter is decided on the merits. Again, this mirrors other lawsuits, such as those in New Jersey — where Kalshi won an injunction – Maryland — where it failed to win an injunction — and Nevada — where it won an injunction, only to have it dissolved.

Tennessee also sent cease-and-desist letters to Polymarket and Crypto.com Friday, but a search for those businesses in the relevant court does not show any lawsuits filed by either company.

Commodity Futures Trading Commission (CFTC) Chairman Michael Selig on Monday launched the Innovation Advisory Committee (IAC) and, in a release, said he intends to tap several prediction market heads already serving on the CEO Innovation Council as its charter members.

Most members of the group represent companies in some stage of offering prediction market speculation or invest in or support them with technology.

Current members of the CEO Innovation Council:

• Shayne Coplan, Polymarket
• Craig Donohue, Cboe Global Markets
• Terry Duffy, CME Group
• Tom Farley, Bullish
• Adena Friedman, Nasdaq
• Luke Hoersten, Bitnomial
• Tarek Mansour, Kalshi
• Kris Marszalek, Crypto.com
• David Schwimmer, LSEG
• Arjun Sethi, Kraken
• Jeff Sprecher, Intercontinental Exchange
• Tyler Winklevoss, Gemini

“A wide range of novel technologies are enabling the creation of entirely new products, platforms, and businesses and transforming the financial markets landscape,” Selig said in a release. “Innovators are harnessing technologies such as artificial intelligence, blockchain, and cloud computing to modernize legacy financial systems and build entirely new ones. Under my leadership, the Commission will develop fit-for-purpose market structure regulations for this new frontier of finance. The Innovation Advisory Committee will play a critical role in advising the Commission on the commercial, economic, and practical considerations of emerging products, platforms, and business models in the financial markets so that it can develop clear rules of the road for the Golden Age of American Financial Markets.”

According to the IAC charter, the council’s objective will be to “provide advice and recommendations to the Commission. The IAC will assist the Commission in identifying and understanding and by providing advice on the impact and implications of technological innovation in the financial services, derivatives, and commodity markets.”

Kalshi changed its rules Monday to allow for “fractional shares,” meaning that users could be able to buy one cent worth of contracts.

Kalshi says that the change allows “order fills to always be possible in whole dollar amounts,” ensuring that users can bet the amount they intend to, instead of having a partially filled order.

An amendment to Kalshi’s rulebook, filed with the Commodity Futures Trading Commission (CFTC), reads: “The minimum unit of trading is one hundredth of one Contract, unless otherwise specified in a Contract’s terms and conditions or on the Contract’s market page.”

In a letter to the CFTC accompanying the rule change, Kalshi explained why it may be relevant.

“For example, if a trader wants to purchase $5.00 of a given position, but the contract is trading at $0.60, the trader would previously purchase eight contracts at $0.60 each,” Kalshi wrote. “This would in turn only deploy $4.80 of the trader’s intended capital. Under the new rule, the trader would be allowed to deploy all of their intended capital and manage their positions as they see fit.”

The same line previously set the minimum at one contract. Each contract is valued at one dollar.

The rule change is subject to a 10-day review by the CFTC, and can then come into effect once the review period is over. The review period only counts working days, meaning the rule could go into effect starting Jan. 27.

Tennessee has become the latest state to send a cease-and-desist letter to prediction markets, ordering Kalshi, Crypto.com, and Polymarket to stop offering sports contracts in the state.

On Friday, the regulator sent a letter to Kalshi CEO Tarek Mansour, Polymarket U.S. Chief Compliance Officer Matt Childers, and Crypto.com Chief Compliance Officer Kevin Dan, arguing that the platforms are in violation of the state’s Sports Wagering Act. The news was first reported by lawyer Daniel Wallach on social media site X.

“The sports events contracts offered on Kalshi’s exchange are wagers under the Act and are being offered illegally in violation of Tennessee law and regulations,” the letter to Kalshi said. The letters to Crypto.com and Polymarket contained similar statements.

The Tennessee Sports Wagering Council told the platforms to cease offering sports event contracts “immediately,” and said it would fine them if they did not. 

Wallach reported that “lawsuits have been filed,” but none appear in the relevant court’s docket yet.

U.S. Rep. Dina Titus has written a letter to Polymarket CEO Shayne Coplan asking about the prediction market’s “ability, and willingness, to comply with CFTC regulations.”

Titus, who represents Nevada, noted that Polymarket in July purchased a CFTC-regulated exchange and has since reentered the U.S., but Titus said there were “significant questions about whether the platform was adopting “safeguards consistent with CFTC rules.”

Polymarket’s global site still blocks users with U.S. IP addresses, and so it does not appear that the site has a legal obligation to follow CFTC rules.

Titus cited trades made on Polymarket’s global site on the capture of Venezuela’s President Nicolas Maduro, which were made before the public was aware of the raid to capture him.

“While it is unclear whether these wagers constituted insider trading, their timing raises significant questions,” Titus wrote.

Insider trading is technically permitted under CFTC rules, as long as the information in question is not misappropriated, and there is no market manipulation involved. In practice, CFTC-regulated prediction markets ban insider trading under their house rules but if one chose not to, that would not be inconsistent with CFTC rules. Unlike it’s CFTC-regulated U.S.-site, Polymarket’s global site’s rules do not include an insider trading ban.

She also raised questions of market manipulation, citing Coinbase CEO Brian Armstrong’s recent decision to list off several words from a prediction market contract on what words he would say during the company’s earnings call.

Titus asked Coplan about Polymarket’s rules to prevent insider trading, surveillance tools, how many accounts it had suspended due to insider trading or market manipulation and Polymarket’s compliance with the CFTC’s core principles.

Polymarket has announced its third partnership of the week, teaming up with the Golden Globes to become its “exclusive prediction market partner.”

Polymarket announced the deal via a post on social media site X, and it is not immediately clear what the partnership entails.

The exchange announced a partnership with Dow Jones, which owns the Wall Street Journal, and a deal with the NHL’s New York Rangers earlier this week.

Kalshi is the subject of another class-action lawsuit, this one filed in federal court and invoking Illinois’ “Statute of Anne” laws.

The Statute of Anne, which originated in Britain in 1710, permits gamblers to sue for illegal gambling losses. The plaintiffs in this case argue that Kalshi is a form of illegal gambling.

The initial filing claims that while Kalshi advertises itself as a prediction market, it “in reality offers illegal, unregulated wagers.”

Illinois’ Statute of Anne is a state law, and Kalshi has generally argued that it is not subject to state gambling laws. It is likely that if needed, it would employ the same defense in this case.

A number of class-action lawsuits based on Statute of Anne laws were filed in state courthouses across the country last year. Kalshi has filed for many of those, including one in Illinois, to be moved to federal court, but progress in those lawsuits has been slow.

Users of the prediction market filed a class-action against Kalshi in the Southern District of New York in November. That case received a great deal of attention, but has had little progress since it was filed.

Gemini has now launched spots event contracts, becoming the latest entrant into the rapidly growing market, as first reported (to our knowledge) by Next Event Horizon.

The exchange founded by the Winklevoss twins launched its prediction market last month, soon after the CFTC approved its application to become a designated contract market (DCM).

Unlike other prediction markets, Gemini is using official NFL team logos on its prediction market webpage. The NFL has opposed the rise of sports event contracts through prediction markets, has not partnered with any exchange, and usually polices unapproved uses of its team marks.

The top markets — Friday’s Peach Bowl between Indiana and Oregon, and Saturday’s NFL playoff game between the Rams and the Panthers — have received tens of thousands of dollars in volume. Other NFL playoff games have volume in the four digits, while volume for NBA games is minimal.

Bitnomial looks to be closer to launching a prediction market in the U.S. following its receipt of a no-action letter from the Commodity Futures Trading Commission (CFTC) concerning reporting rules.

Bitnomial has been registered as a designated contract market (DCM) since 2020, and used that status to offer cryptocurrency futures and options. It said in a press release last month that it had received approval from the CFTC to operate a prediction market as well.

No-action letters mean the CFTC will refrain from enforcing certain rules against a particular business.

The letter itself only concerns rules about reporting data — allowing Bitnomial to report event contract data as if the contracts were binary options, instead of swaps — but is typically one of the final steps before a prediction market that is already licensed can go live. For example, Gemini received a no-action letter on Dec. 11, and then launched its prediction market on Dec. 16.

Before launching, Bitnomial will also have to self-certify the markets it wishes to offer.