Kalshi Captures 89% of U.S. Prediction Market as CFTC-Regulated Model Leads Rivals

Kalshi offers event contracts as a designated contract market regulated by the US Commodity Futures Trading Commission (CFTC). The central legal question is whether contracts allowing users to trade on outcomes are federally regulated derivatives or sports betting products subject to state oversight. The rulings will determine whether prediction markets can operate nationwide.

In early July 2026, Kalshi failed to secure a Nevada Supreme Court stay of an order blocking trading in the state, while a Michigan court issued a separate two-week temporary restraining order. The company also sued Ohio regulators and mounted a legal defense in Minnesota. North Carolina’s proposed budget would impose a 6% tax on related revenue, while Kalshi’s deadline to appeal in New Jersey was extended to August 4.

Kalshi is a prediction-market platform regulated by the U.S. Commodity Futures Trading Commission (CFTC) that allows users to trade contracts based on sporting-event outcomes. Illinois has subjected such products to state sports-betting restrictions, sparking a dispute over whether federal derivatives oversight preempts state intervention. The outcome could also affect how prediction markets operate across states.

Kalshi recently sued Illinois officials to challenge a provision in the state's newly enacted budget bill that is scheduled to take effect on July 1. The company argues that restrictions on sporting-event contracts encroach on the CFTC's exclusive regulatory authority. It is seeking to block enforcement, saying the provision would immediately restrict its products and cause irreparable harm that monetary damages could not adequately remedy.

Kalshi is a prediction market regulated by the U.S. Commodity Futures Trading Commission (CFTC), allowing users to trade contracts on the outcomes of political, economic and sporting events. Its regulated status has helped it tap demand for sports betting, while both revenue and valuation have climbed. Its potential listing has also become an important gauge of prediction markets' move into mainstream finance.

As of July 2026, Kalshi's annualized revenue had surpassed $2 billion, about three times its level at the end of 2025, driven mainly by trading tied to sporting events including the NBA and World Cup. The company's valuation also doubled within six months to $22 billion. It has reportedly begun early, informal IPO talks with investment banks but has yet to announce a listing timetable.

Kalshi is a regulated prediction-market platform where traders buy and sell contracts tied to event outcomes. As financial-industry employees participate in such markets, they could use nonpublic information to trade, creating risks similar to insider trading. Companies therefore need to incorporate prediction markets into their existing employee trade-reporting, audit and compliance-monitoring systems.

Kalshi has partnered with compliance software provider StarCompliance to launch a surveillance platform that allows financial institutions to centrally track employees’ prediction-market trades. It also integrates auditing and investigation management for on-chain and off-chain activity. Reports did not disclose the partnership date, transaction value or number of institutions adopting the platform, but its central goal is to improve the detection of unusual trading and prevent the misuse of nonpublic information.

Kalshi structures outcomes in sports, elections and other areas as event contracts and operates as a designated contract market regulated by the U.S. Commodity Futures Trading Commission (CFTC). Minnesota, however, considers the activity gambling subject to state law. The dispute centers on whether the Commodity Exchange Act grants exclusive federal jurisdiction that preempts the state ban under the U.S. Constitution’s Supremacy Clause. The outcome could reshape regulatory boundaries nationwide.

Governor Tim Walz signed SF 4760 on May 18, 2026, before replacing it with SF 3432 on May 26. Effective August 1, the law makes operating, facilitating or advertising prediction markets a felony. The CFTC sued on May 19 and sought an injunction, followed by Kalshi on May 27. Kalshi also argued that the advertising restrictions violate the First Amendment. The litigation is expected to continue through appeals and could ultimately be decided by the U.S. Supreme Court.

Kalshi is a prediction market platform regulated by the U.S. Commodity Futures Trading Commission (CFTC), allowing users to trade contracts tied to political, economic and other events. Traditional gambling operators are largely regulated by state governments, creating conflicts over regulatory authority and market access. Federal legislation would shape the industry's competitive landscape.

Kalshi recently announced its support for the newly formed Americans for Fair Markets (AFM), which argues that prediction markets should be regulated exclusively by the CFTC. It also backs the Gillibrand–McCormick bill to establish a federal legal framework. Available information does not provide the dates of the group's formation or Kalshi's announcement, and no investment or fundraising amounts were disclosed.

Kalshi is a designated contract market regulated by the U.S. Commodity Futures Trading Commission (CFTC) that offers event contracts tied to outcomes including sports results. The Ohio Casino Control Commission considers such products to be sports betting that requires a license, prompting Kalshi to sue in October 2025. The dispute centers on whether federal derivatives regulation preempts state intervention, and its outcome could also affect platforms such as Polymarket.

On May 12, 2026, the CFTC filed an amicus brief with the U.S. Court of Appeals for the Sixth Circuit supporting Kalshi’s challenge to a federal district court’s March 2026 denial of an injunction. The CFTC called Ohio’s action a “jurisdictional overreach” and asked the court to affirm its exclusive authority over event contracts offered on designated contract markets. The filing marks the agency’s second intervention in a similar case, following its support for Crypto.com in the Ninth Circuit in February.

Kalshi is an event-contract exchange regulated by the U.S. Commodity Futures Trading Commission, with contracts settling according to the outcomes of specified events. Greenlight Commodities has brought an NFA-registered framework for privately negotiated trades and centralized clearing to prediction markets. This allows institutions to hedge or invest with defined risk around individual events such as carbon prices, marking a significant step toward a more institutionalized market structure.

On April 27, 2026, Greenlight Commodities announced that it had brokered the first large institutional over-the-counter trade on Kalshi, with a Houston-based environmental hedge fund and Jump Trading Group on opposite sides. The trade was worth a six-figure dollar amount, but the exact value was not disclosed. The contract was linked to the settlement price of California’s 47th joint carbon allowance auction on May 20. Bernstein described the transaction on May 4 as a milestone in the market’s institutionalization.

Kalshi is a designated contract market regulated by the US Commodity Futures Trading Commission, allowing users to trade event contracts tied to outcomes including sports results. Each contract settles at a maximum of $1. New Jersey's Division of Gaming Enforcement classified the activity as unlicensed sports betting, raising the question of whether federal derivatives regulation preempts state law.

On April 6, 2026, the US Court of Appeals for the Third Circuit voted 2–1 to uphold a preliminary injunction issued on April 28, 2025. The court found that sports event contracts are swaps under the Commodity Exchange Act and fall under the CFTC's exclusive jurisdiction. On June 26, the state separately requested an extension until September 4 to file a petition for a writ of certiorari with the Supreme Court.

Prediction markets such as Kalshi and Polymarket allow users to trade on the outcomes of political, sporting and other events, but it remains unsettled whether their contracts constitute gambling or financial hedging instruments governed by federal commodities law. The dispute will shape the jurisdictional boundary between the CFTC and state gambling regulators, as well as platforms’ ability to operate across state lines.

As of July 19, 2026, prediction-market operators faced about 20 lawsuits, with 11 states having taken legal action. The CFTC asserted full jurisdiction over the contracts, but Kalshi lost an Ohio case involving sports betting. Users could therefore face state-specific restrictions, account compliance requirements and cross-border trading risks.