After State Lawsuit Losing Streak, Kalshi Nabs Victory in Tennessee—This Could Be Why
Kalshi achieved a significant legal victory in Tennessee, where a federal judge granted a preliminary injunction favoring its position that sports-related prediction markets are event contracts regulated by the CFTC, not sports bets under state authority. This outcome contrasts with recent losses for Kalshi in Maryland, Massachusetts, and Nevada, where judges sided with state regulators claiming jurisdiction over such markets. The legal split centers on strategy—states prevailing against Kalshi have focused on the argument that Congress never intended the CFTC to regulate sports-related wagers. In contrast, Tennessee’s narrower argument about whether these markets are “swaps” under CFTC purview has not held up in court. Legal expert Daniel Wallach attributes these differences partly to resources; states with outside legal counsel have fared better than those relying on in-house teams. The ongoing jurisdictional battle—fueled by differing legal approaches and statements from regulatory authorities—suggests the issue may ultimately require Supreme Court resolution.
