Ohio & Tennessee beat Kalshi as court backs state gambling laws

The court also held that even if the contracts were swaps, federal law does not preempt Ohio’s or Tennessee’s gambling laws.

The hit

A US Court of Appeals for the Sixth Circuit panel ruled unanimously against Kalshi on Friday, siding with Ohio & Tennessee. The judges found Kalshi’s sports-event contracts do not qualify as swaps under federal law, so the states can enforce their own gambling rules against the platform.

Why it matters

Kalshi asserts that only the US government can regulate it, while the platform operates without state gambling licences or taxes, according to Ars Technica. Another federal appeals court has now rejected that position. Many states are trying to stop or restrict gambling on Kalshi.

The record

Court	US Court of Appeals for the Sixth Circuit
Panel decision	Unanimous, 3 judges
Opinion author	Judge Julia Smith Gibbons, George W. Bush appointee
Outcome	Ohio district ruling upheld; Tennessee district ruling vacated

What happens next

Watch for Kalshi’s response & whether Ohio & Tennessee regulators now move to enforcement action, plus how other states cite this ruling in their own cases against the platform.

Sources: Kalshi loses again as judges rule prediction markets must obey gambling laws

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