The CFTC just told Kalshi to keep processing trades for Michigan residents, even as a state judge ordered the prediction market platform to stop offering sports-related contracts in the state.
Ingham County Circuit Court Judge Rosemary Aquilina issued a temporary restraining order on June 29 against KalshiEX LLC, prohibiting the platform from offering sports-related event contracts to Michigan residents for 14 days. The TRO carries potential fines of $120,000 per day for non-compliance.
A jurisdictional tug-of-war with real money on the line
Kalshi is a CFTC-registered Designated Contract Market, which means the federal government has formally recognized it as a legitimate exchange operating under the Commodity Exchange Act. The CFTC’s position is that event contracts qualify as swaps under federal law, and federal oversight preempts state gaming regulations.
Michigan sees it differently. The state’s Gaming Control Board argued the TRO was necessary to protect vulnerable residents from what it characterizes as unlicensed sports wagering. Michigan Attorney General Dana Nessel initiated the underlying lawsuit on March 5, following a federal remand that sent the case back to state court.
