Prediction markets’ regulation draws closer to Supreme Court
The filing follows a circuit split over whether sports-related prediction contracts are gambling or federally regulated swaps, with the Supreme Court given about 90 days to decide.
- On Wednesday, New Jersey Attorney General Jennifer Davenport filed a Supreme Court petition seeking to resolve whether states can block prediction markets or whether these platforms constitute federally regulated swaps rather than illegal gambling.
- Litigation has erupted across at least 20 states, with courts currently split on whether prediction markets violate state gambling laws; companies like Kalshi claim their products are federally regulated swaps rather than sports bets.
- A recent Ninth Circuit Court of Appeals ruling supporting Nevada's laws created a conflict with earlier decisions, and legal expert Daniel Wallach notes the high court reverses lower courts roughly 70% of the time.
- The Supreme Court now has about 90 days to decide whether to grant the petition, while Kalshi will have 30 days to respond once docketed, marking the first certiorari petition on this business model.
- Analysts suggest the Supreme Court might wait for the Commodity Futures Trading Commission to finalize its event contract rulemakings, as final rules would likely face Administrative Procedures Act challenges signaling the issue is not yet ready for review.
13 Articles
13 Articles
Prediction markets’ regulation draws closer to Supreme Court
Prediction markets have arrived at the Supreme Court’s doorstep. New Jersey this past week urged the justices to settle how prediction markets should be regulated, and a split among the nation’s appeals courts is increasing expectations that they may be inclined to get involved. The Trump administration is trying to push states out, hoping to keep prediction markets under…
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New Jersey on Wednesday asked the Supreme Court to shut down prediction markets in the state, teeing up a potential landmark case where the justices could decide if the highly popular but controversial industry can survive in its current form.
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