Supreme Court tipped to settle prediction market turf war by July

Bloomberg Intelligence expects the Supreme Court to take the case by year end, with a ruling by July.

The hit

The fight over who regulates US prediction markets has splintered into four separate strands of litigation, according to CFTC General Counsel Tyler Badgley speaking at Predict 2026 in New York. These range from companies suing states to block gambling-law enforcement, to states bringing criminal indictments against CFTC-regulated firms, Badgley said.

Why it matters

For bettors & operators, the mess means no settled answer yet on whether sports event contracts count as federally regulated derivatives or state-controlled gambling. Until courts or Congress decide, products like Kalshi’s sports contracts face a patchwork of state bans, injunctions & indictments that could change market by market.

The record

Sports event contracts launched	March last year, per Rob Schwartz of Morgan, Lewis & Bockius
Arizona indictment against Kalshi	20 counts for unlicensed gambling & illegal election wagering, filed March by Arizona attorney general
Federal block on Arizona case	Temporary restraining order issued April, case on hold
Circuit court splits identified	Three, according to Bloomberg Intelligence’s Elliott Stein
Supreme Court timeline forecast	Case accepted by year end, ruling by July, per Stein

What happens next

Watch for the Fourth Circuit ruling on Kalshi v Maryland regulators & the Massachusetts Supreme Court decision on state authority over sports event contracts.

Sources: Predict 2026: CFTC, states battle over regulatory authority – CDC Gaming

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