{"title": "Federal Appeals Court Overturns New Jersey's Attempt to Block Kalshi Prediction Platform", "body": ["A panel from the 3rd US Circuit Court of Appeals determined on Monday that New Jersey lacks the jurisdiction to oversee Kalshi's platform for wagering on sports event results. The decision, issued by a 2-1 majority, assigns that regulatory authority exclusively to the Commodity Futures Trading Commission."], ["The CFTC, currently led by Michael Selig—a nominee of President Donald Trump—enthusiastically endorses platforms such as Kalshi and Polymarket, describing them as innovative offerings. The Trump family's involvement underscores this support: Donald Trump Jr. serves as a compensated consultant for Kalshi and a volunteer advisor for Polymarket, while the Trump Media and Technology Group's Truth Social platform plans to launch its own prediction market feature."], ["These digital prediction platforms represent a growing trend, enabling participants to wager on diverse events ranging from regional sports matches to international conflicts involving armed forces. Despite their novelty, such sites have demonstrated significant instances of insider trading, including anomalous wagers and substantial returns linked to US and Israeli actions against Iran, as well as the short-lived US operation in Venezuela. Blockchain expert DeFi Oasis reports that less than 0.04% of Polymarket users accounted for over 70% of the gains, amounting to $3.7 billion."], ["In recent months, various state gambling oversight bodies have initiated lawsuits against Kalshi and Polymarket. Just last week, the CFTC took legal action against Arizona, Connecticut, and Illinois for their efforts to control these markets. Although the states' arguments vary—covering topics like elections and bets by minors—they collectively assert that prediction markets constitute unlicensed gambling operations. The Monday decision stands as the initial federal court outcome in these disputes, favoring the platforms' operators."], ["In 2025, New Jersey issued a stop-order to Kalshi, alleging that the service breached the state's prohibition on betting related to college athletics. Kalshi responded by filing a lawsuit against New Jersey, contending that its sports event contracts qualify as swaps—a financial instrument under CFTC purview. An initial district court judge ruled in Kalshi's favor, leading New Jersey to seek an appeal. The appellate panel's two judges agreed that these contracts are swaps. Kalshi's chief executive, Tarek Mansour, described the verdict as a major victory for the sector."], ["In a dissenting opinion, US Circuit Judge Jane Richards Roth argued that Kalshi's products closely resemble the wagering options found on major online sports betting sites like DraftKings and FanDuel."], ["New Jersey's Attorney General, Jennifer Davenport, may petition the entire 3rd Circuit for an en banc review, and similar matters remain under consideration in other judicial venues."]}