New Jersey Asks Supreme Court to Settle Who Regulates Kalshi and Prediction Markets
New Jersey has taken its fight over prediction markets all the way to the top. State Attorney General Jennifer Davenport and the interim director of the state’s Division of Gaming Enforcement have filed a petition for a writ of certiorari asking the US Supreme Court to settle a question that has now split two federal appeals courts: does a federal agency’s approval let a platform like Kalshi sidestep state gambling law entirely?
April: the Third Circuit sides with Kalshi
The petition traces back to an April ruling from the US Court of Appeals for the Third Circuit, which went against New Jersey’s gaming regulators. The appeals court found Kalshi had a reasonable chance of prevailing on its argument that jurisdiction over its sports-linked markets belongs to the Commodity Futures Trading Commission, not state gaming authorities — a decision that effectively blocked New Jersey from enforcing its own gambling licensing rules against the platform.
Late August: Nevada gets the opposite answer
Just days before New Jersey filed its petition, the Ninth Circuit Court of Appeals reached the reverse conclusion in a separate case out of Nevada, ruling that state gaming regulators there could still require Kalshi to hold an active state license. That created the direct circuit split — one appellate court favoring the states, another favoring CFTC-registered platforms — that makes Supreme Court review far more likely than it would otherwise be. Coin680 has previously covered that Ninth Circuit decision in detail as its own standalone story; this new petition is a distinct filing in a different case, not a continuation of the Nevada dispute.
September 2: New Jersey goes to the Supreme Court
With the split now on the books, Davenport’s office filed its petition asking the justices to resolve whether the 2010 Dodd-Frank Act preempts states from regulating sports-linked bets placed within their borders, so long as those bets run through markets registered with the CFTC. New Jersey’s position, in Davenport’s own words, is that companies like Kalshi “claim to offer legal sports betting in every state — but refuse to follow the gambling laws of any state,” and that the court needs to clarify that Congress never intended to silently exempt the entire prediction-market industry from state oversight.
Why the stakes go beyond one state
If the Supreme Court takes the case, the ruling would not just settle New Jersey’s dispute — it would determine which regulator, state gaming boards or the federal CFTC, has final say over an entire category of products that has expanded rapidly into sports, elections, and other event outcomes. Kalshi and similar platforms have leaned on federal registration as their legal shield in state after state; a ruling against that theory would upend the compliance model the industry has built itself around. A ruling for it would cement federal preemption and likely end most remaining state-level challenges outright.
There is no guarantee the Court agrees to hear the case at all — certiorari petitions are granted in only a small fraction of filings. But with two circuits now openly disagreeing, prediction markets have a genuinely live shot at Supreme Court review in the term ahead.
Regulatory and legal outcomes are unpredictable, and this article is for informational purposes only, not legal or investment advice. This is not related to Bitcoin custody or trading directly, but jurisdictional battles like this one shape the wider regulatory climate crypto-adjacent platforms operate in — for more on how regulation intersects with digital assets, see coin680’s Bitcoin Academy.