9th Circuit Rules States Can Regulate Prediction Market Platforms

The 9th U.S. Circuit Court of Appeals has ruled that states can regulate prediction market platforms, potentially allowing Arizona to prosecute Kalshi. This decision overturns a federal judge’s order that previously blocked such state-level action.

What Happened

The 9th U.S. Circuit Court of Appeals issued a ruling indicating that gambling on sporting events is not protected under federal law (Biztoc.com). This appellate court decision effectively sides with states in their efforts to regulate prediction market companies, specifically in a case involving Kalshi (azmirror.com, Biztoc.com).

The ruling challenges a previous federal judge’s order that had prevented Arizona from prosecuting the online prediction market company, Kalshi, for alleged violations of the state’s gambling statutes (Biztoc.com, azmirror.com). The 9th Circuit’s stance suggests that the order blocking Arizona’s prosecution of Kalshi may be temporary (Biztoc.com).

Key Details

• The 9th U.S. Circuit Court of Appeals ruled that federal law does not protect gambling on sporting events (Biztoc.com).
• This ruling has the potential to revive Arizona’s prosecution of the online prediction market company, Kalshi (azmirror.com, Biztoc.com).
• A prior federal judge’s order had blocked Arizona from prosecuting Kalshi for alleged violations of state gambling laws (Biztoc.com).

Why It Matters

This judicial development reasserts the authority of states to regulate activities on prediction market platforms if those activities are deemed to constitute gambling under state law. The decision from the 9th Circuit Court of Appeals sets a precedent that could affect the operational framework for similar platforms within regulated markets (azmirror.com). For operators and regulators, this ruling clarifies the limits of federal preemption regarding certain forms of online wagering (Biztoc.com).

Originally reported by Biztoc.com·Published 29 Aug 2026, 02:43