CFTC Invokes Emergency Powers to Keep Kalshi Trading Despite New York Suit
The CFTC used emergency authority to order Kalshi to keep trading after Kalshi reported a market emergency triggered by New York’s lawsuit. The order requires KalshiEX to continue operating under Commodity Exchange Act core principles. New York Attorney General Letitia James sued on July 31 to stop Kalshi from offering event contracts nationwide and seek over $36 billion in damages. CFTC Chairman Michael Selig said states are trying to force prediction markets to “waste away” under state gaming laws, arguing these are interstate financial markets, not gambling. The agency says it has now sued nine states and filed briefs in several federal appeals and state high courts. Kalshi has had mixed court results, including losses in New York, Michigan, Washington, and Minnesota. James’ complaint calls Kalshi an unlicensed gambling business and seeks treble damages and penalties.
