Kalshi's ban application was rejected; the U.S. judge ruled that prediction markets do not take precedence over state gambling laws.

Mars Finance News: On March 11, Chief Judge Sarah D. Morrison of the Southern District of Ohio ruled that there is no historical evidence that Congress intended to prioritize federal law over state sports betting regulations. Based on this, the court dismissed the preliminary injunction request filed by prediction market platform Kalshi. Previously, Kalshi sued the Ohio Casino Control Commission to prevent enforcement actions against its event contracts under state gambling laws. Last year, the regulatory agency accused Kalshi of operating illegal sports betting in Ohio. Kalshi argued that its event contracts are derivatives regulated under the Commodity Exchange Act and should be overseen by the CFTC, thus federal regulation should take precedence over state gambling laws. However, the judge stated that, based on history and legislative background, there is no evidence that Congress intended for this law to override state sports betting regulations. The judge also noted that when the Dodd-Frank Act was amended in 2010, sports betting was still generally restricted in the U.S. Kalshi announced it will appeal the ruling. This case is seen as a significant test of the legal status of prediction markets, and its outcome could impact the future compliance prospects of other prediction platforms in the U.S., including Polymarket.