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The 3-0 ruling creates a circuit split with a Third Circuit decision and sets up a likely Supreme Court showdown
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The Ninth Circuit Court of Appeals ruled Friday that states can regulate sports-related prediction market contracts as gambling, handing a major legal defeat to platforms including Kalshi, Crypto.com, and Robinhood.
The three judges, ruling without dissent, determined that Kalshi's sports event contracts did not qualify as "swaps" — the federally regulated derivative category the platforms had claimed — and instead constituted sports bets that states may govern under their gaming laws. "The substance of the sports event contracts offered on Kalshi's exchange is sports gambling, regardless of whether Kalshi calls them swaps," the court wrote in its opinion.
