It seems that New York is asking the court for a temporary restraining order that would prohibit Kalshi from offering all event contracts nationwide. I also have zero love for Kalshi, but I can see why such a request would be concerning, regardless of whether I think Kalshi is a degenerate trash heap.
In saying, "New York seeks a temporary restraining order prohibiting KalshiEX, LLC from offering all event contracts nationwide" the CFTC's press release substantially misrepresents the filing by the NY AG. On page 29, the filing requests "Permanently enjoining Respondent and its principals, agents, and employees from operating an unlawful gambling business, or otherwise advancing gambling activity, or profiting from gambling activity, within or from New York or to persons in New York, without being licensed by the New York State Gaming Commission" (https://ag.ny.gov/sites/default/files/court-filings/new-york...).
Since Kalshi's HQ is in NY, I guess the most charitable interpretation is that perhaps the CFTC's statement is based on the assumption granting the TRO would have the net effect of disrupting Kalshi's operations everywhere until they can serve the site from outside NY. Of course, without disclosing that extrapolation, the statement is still factually incorrect.
Setting aside that significant error, I suspect this CFTC order is an attempt to create a federal vs state conflict in the hope the judge will suspend or defer any TRO until that issue is decided. I imagine Kalshi will file a response tomorrow arguing exactly that. Ultimately, this will still come down to whether Kalshi can be regulated by states, and if so, whether it's gambling.
Take out some of the "or"s that obscure it and you get "or otherwise advancing gambling activity from New York, without being licensed by the New York State Gaming Commission". Seems very straightforward to me.
When Texas shut down porn sites internationally, this didn't happen, the order from Texas was allowed to stand. This is because Texas is a red state and NY is blue.
That's not true at all. New York is asking the court to stop the Kalshi executives, who are located in New York, from flagrantly violating the sports gambling laws of New York. Kalshi would be free to move to another state where sports gambling is legal if they wanted to keep the platform up.
But federal law preempts state law, and the federal regulator, the CFTC, has now decided that prediction market contracts are indeed swaps if you think about it, and thus under their regulation. If you believe the latter, then New York has no business trying to separately regulate Kalshi as a sports book.
I do not believe the latter. The attorneys general of nearly every state in the US have signed onto a letter explaining in detail (https://oag.maryland.gov/News/Documents/pdfs/2026-4-30%20CFT...) why the sports-related contracts sold on prediction markets are not swaps nor otherwise subject to CFTC regulation. This isn't a close or debatable question, it's not even a partisan one, and the only reason why a controversy exists is that Kalshi and Polymarket have gotten Americans hooked while bribing key government officials to clear the way.
I can't read your link (it 403s), but there's no fundamental line separating things that are clearly financial instruments but are nonetheless cash-settled derivatives on binary propositions (e.g. credit default swaps), ones that are clearly not financial but also not sports gambling (weather/political prediction markets) and things that are pretty obviously sports gambling (most of Kalshi). The form of these are all identical and so ought to be regulated identically.
I also don't see why _sports_ betting is so especially bad - even if New York were successful here, Kalshi would still be able to offer it's degenerate gamblers all sorts of stupid bets in culture, politics, weather, etc. When I grew up, the only thing you could bet on was horses and dogs... so the gamblers were really into form guides and horses. If the only thing they could gamble on was politics and news markets, they would just obsess over that instead.
What's bad about sports gambling is that it doesn't follow the model you're describing. The AGs point towards a study (https://perma.cc/4SF5-VGZH) which finds that legalizing sports betting does not just reallocate money that was going to go to gambling anyway. Instead it crowds out savings. There are people who will explicitly tell pollsters and journalists (see e.g. https://www.bloomberg.com/news/articles/2026-08-12/gen-z-inv... from yesterday) that they engage in sports betting because they see it as a fun alternative to traditional investments.
The NV link doesn't work either. I suspect geoblocking.
That study is measuring the effect of the introduction of _any_ modern online betting to these jurisdictions; before it was legalised there was no equivalent other than going to a casino or racetrack. But that genie can't be put back in the bottle just by restricting sports betting to sports books, as NY is asking for, now that all sorts of other prop bets are available as substitutes (and also sports betting on state-licensed sites). IMO regulators should focus on forcing the market makers to offer tighter spreads so prediction markets (and options etc.) are less negative-expectation for retail punters.
…And growing wheat on your own land to feed your own cattle somehow counts as interstate commerce, despite no commerce taking place and the wheat never leaving your property, let alone the state. (Wickard v. Filburn)
Wickard was growing wheat for interstate commerce. The case was about whether the additional wheat he grew for "personal" use was also part of interstate commerce.
It was a creative ruling in multiple senses of the word. They invented the idea from whole cloth and it effectively created new laws from the bench.
> The Court decided that Filburn's wheat-growing activities reduced the amount of wheat he would buy for animal feed on the open market, which is traded nationally, is thus interstate, and is therefore within the scope of the Commerce Clause. Although Filburn's relatively small amount of production of more wheat than he was allotted would not affect interstate commerce itself, the cumulative actions of thousands of other farmers like Filburn would become substantial. Therefore, the Court decided that the federal government could regulate Filburn's production.
There were similar issues dating back to the founding of the country. However nobody pays those any heed because it destroys the ideological claims they're trying to make.
Just around, or slightly around the level of testing that Roe vs Wade prior to Dobbs. Or a bakers dozen of other established precedents that were "one of the more tested legal concepts" until ... recently.
Generally speaking, no: there’s a significant difference in precedent between the two. IANAL, but interstate commerce is explicitly written into the Constitution as the jurisdiction of the federal government and was tested (and generally serially expanded) in court multiple times long before Roe.
Birthright citizenship is explicitly written into the Constitution, yet about a month ago, 2 SCOTUS justices provided opinions and votes suggesting that this detail doesn't matter much.
Unfortunately for Roe v Wade, abortion and a right to privacy aren't explicitly laid out in the Constitution. Interstate commerce is. New York would be entirely in their right to ban Kalshi in New York but not halt operations nationwide.
It sounds like it's more, New York wants to halt Kalshi's New york operation, however Kalshi is headquartered in New York, so this would stop all of Kalshi's operations.]
If New York has this jurisdiction(management of for profit incorporation's in New York) Kalshi would have to reorganize somewhere else to continue operations.
Not literally. I think the text in question is: "within or from New York or to persons in New York." Where CFTC is arguing that "from" would have interstate consequences. I'm not a legal expert, though, so I have no idea if something similar has been fought in court before.
edit
Interesting, I found KalshiEX LLC v. Flaherty [1] which seems strikingly similar to this case and was ruled in favor of Kalshi.
"The Third Circuit affirmed the District Court’s order. The appellate court held that the Commodity Exchange Act (CEA) grants the Commodity Futures Trading Commission (CFTC) exclusive jurisdiction over swaps, including sports-related event contracts traded on CFTC-licensed DCMs."
These are the CFTC licensed contract markets, which are not the same exact thing.
I'm not sure how to explain all this without writing a 70 page dissertation on HN, and it's probably not worth it :)
Overall - this is a wildly complicated area. To give you an idea how complicated: Ignoring state law, transmitting gambling information for sports events over the wire is a federal crime. See 18 U.S.C. § 1084(a), which makes it a crime for a person “engaged in the business of betting or wagering” knowingly to use an interstate or foreign wire facility to transmit bets/wagers or information assisting bets/wagers “on any sporting event or contest.”
(It's legal if you are transmitting from a jurisdiction where it's legal to a jurisdiction where it's legal).
This has been upheld repeatedly for sporting events.
New york can, and did, include a claim to enjoing them from violating this act, which has absolutely no pre-emption issue because it's not a state law.
The case you cited is going to end up in the supreme court, where it will be a toss up.
(in previous supreme courts, it would be a non-starter and the third circuit would have been summarily reversed)
I don't think you're disputing that the requested order would halt Kalshi's operations nationwide for as long as Kalshi remained headquartered in NYC though? The CFTC's framing is disingenuous, presumably because they wanted to create a false impression that NY was attempting to regulate activity without any nexus in that state, but that's still the practical effect given Kalshi's current location.
