Prediction Markets Weekly Roundup: New Jersey Goes to Supreme Court as NFL Pressures Exchanges | Gambling Insider

Prediction markets had another key week, marked by New Jersey going to the US Supreme Court in the Kalshi case, while the exchange removed sportsbook-style odds and some contracts amid pressure from the CFTC and the NFL.

Here are the main events in the forecast market over the past week.

Prediction market lawsuit could reach the Supreme Court

New Jersey Takes Kalshi Against SCOTUS

New Jersey has asked the U.S. Supreme Court to decide whether states can apply their gaming laws to contracts for sporting events offered on CFTC-regulated exchanges.

The petition follows conflicting appellate decisions. In April, the Third Circuit ruled 2-1 that Kalshi’s sports contracts qualified as swaps and that federal law preempted New Jersey state gaming regulations. Last week, the Ninth Circuit reached the opposite conclusion in a Nevada case.

There is no guarantee that the Supreme Court will choose the case. Some legal analysts have suggested the high court may wait for additional rulings from appellate courts before deciding whether to hear the case.

Michigan extends ban on sports contracts in Kalshi

A Michigan judge has issued a preliminary injunction requiring Kalsha to keep sports contracts unavailable in the state while the legal battle continues.

The Sept. 1 decision extends restrictions first imposed through a temporary restraining order in June. Kalshi must use a third-party geolocation provider licensed by the Michigan Gaming Control Board to ensure that Michigan users cannot access contracts.

Failure to comply with geolocation requirements can result in a fine of $500,000 per day.

The Ninth Circuit’s decision applies to other Kalshi cases

Nevada’s Ninth Circuit ruling is already being used by states in litigation over prediction markets in other countries.

Ohio, Iowa and Utah cited the decision as an additional basis this week, following similar lawsuits filed last week in Rhode Island and Illinois. The August 28 decision rejected Kalshi’s argument that her contracts for sporting events constitute swaps under the Commodity Exchange Act and are therefore subject to the exclusive jurisdiction of the CFTC.

Noviga, New Mexico case extended until 2027

Noviga’s federal lawsuit against New Mexico was stayed until August 13, 2027, after the court granted the parties’ joint request. The order allows Novig to work for the state for the next year.

Novig also dropped his lawsuit against Massachusetts officials last week. The stay will remain in effect until the Massachusetts Supreme Judicial Court rules on Kalshi’s appeal of a preliminary injunction prohibiting him from offering contracts for sporting events without a state license.

Kalshi adjusts contracts as NFL turns to prediction markets

Kalshi Eliminates American Odds and Athlete Injury Markets

This week the exchange made two changes at the initiative of the CFTC. It removed American-style odds from its platform and removed prediction markets related to athlete injuries.

The change in odds follows guidance from the regulator, which warned that sportsbook-style plus-minus prices could mislead users about the nature of event contracts. Kalshi now only displays prices in cents, percentages or multipliers. Other prediction markets have also followed the CFTC’s mandate.

Additionally, the exchange removed injury-related contracts after the CFTC asked it to stop offering them. These included markets for how long athletes would be sidelined and whether individual NFL players would participate in Week 1 games.

Connected: BetMGM customizes the app to resemble the betting market user experience

NFL calls on prediction markets to cancel ‘undesirable’ contracts

With Kalshi canceling injury-related contracts, the NFL has renewed its call for prediction markets to stop offering certain types of football contracts ahead of the 2026 season.

In a letter, NFL Chief Compliance Officer Sabrina Perel reiterated concerns first raised in March, saying the league was “deeply concerned” that contracts in categories previously defined by the league continued to appear on the exchanges.

The NFL objects to contracts related to player injuries, misconduct, fan safety, officiating, roster and personnel decisions, and other outcomes potentially known in advance. It also determined that some gaming offers and contracts involving on-air mentions or celebrity appearances were susceptible to manipulation.

Kalshi bans five traders, including George Santos

Kalshi revealed five disciplinary actions against traders accused of violating exchange rules.

Three political candidates exchanged contracts tied to their own elections and received three-year bans. Meanwhile, former US Rep. George Santos was permanently banned after Kalshi discovered he was manipulating markets.

The fifth enforcement case involved a trader who improperly gained access to another user’s account.

New bills take a different approach to prediction markets

Prediction markets have also caught the attention of lawmakers at both the federal and state levels this week.

Rep. Eugene Vindman introduced HR 10199, the Sell Your Stocks or Resign Act. The legislation would prohibit the president, vice president, members of Congress, senior executive branch officials, federal judges and certain family members from owning or trading in a wide range of investments, including prediction market contracts.

In Illinois, Rep. Travis Weaver introduced HB 5811 on Sept. 2 to repeal the state’s tax on exchange betting transactions. The existing provision imposes a transaction tax of 1.75% on exchange bets. This fee increases to 3.5% after the licensee makes the first five million exchange bets in the financial year.

Investments and market expansion forecasts: Polymarket valued at $21 billion

Trump Jr.’s 1789 Capital Leads Polymarket Round by $1 Billion

Donald Trump Jr.’s 1789 Capital is leading a new $1 billion funding round for Polymarket that will value the prediction market company at approximately $21 billion.

The investment company is expected to contribute about $300 million to this round, having previously invested about $200 million in Polymarket. Trump Jr., a partner at 1789 Capital, is also an adviser to the prediction market firm.

Alpaca collaborates with Kalshi

The forecast market continues to grow as brokerage platform Alpaca has partnered with Kalshi to make event contracts available through its financial infrastructure.

Alpaca said it will offer contracts for CFTC-regulated events through the same infrastructure its partners already use for equities, options, fixed income and cryptocurrency. Its network covers more than 300 financial institutions and 14 million brokerage accounts.

Alpaca Derivatives recently registered with the CFTC as a commission-based futures trader, although the company said it has not yet begun regulated FCM operations.

Kalshi expands platform to Spanish

Kalshi has made its platform available in Spanish as the prediction market exchange seeks to attract more users in the US and abroad. This rollout makes Spanish the first additional language supported on the platform and matches Kalsha’s rapid growth over the past year.

Co-founder Luana Lopez Lara announced the expansion, positioning it as part of the company’s efforts to make prediction markets accessible to a wider audience.

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Chavdar Vasiliev

Global wire editor

Chavdar Vasiliev is the editor of Global Wire in Gambling Insideroverseeing day one coverage of the latest developments in the global gambling industry. His work focuses on regulation, enforcement, revenue, market activity and emerging sectors, including prediction markets and casino betting.

Vasiliev previously reported for publications, including CasinoBeats And Bonus.comcovering the stories shaping the industry in the U.S. and beyond, from legislative debates and market expansion to financial performance and operator strategy.

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