Judge lets Kalshi stock perpetual swaps keep trading during CFTC fight
A judge declined to halt trading in Kalshi's stock perpetual swaps, allowing the products to continue while the platform's regulatory fight with the Futures Trading Commission proceeds. The ruling came with a Friday deadline for the case. The judge expressed doubt about the CFTC's power to regulate retail stock leverage. Kalshi lists dozens of the stock perpetual futures contracts. The decision signals a challenge to the agency's position as Kalshi defends its perpetual swap contracts against regulatory pushback.
Kalshi now operates stock perpetual swaps under court protection while fighting the CFTC on multiple fronts. That protection is narrow: the same platform already faces criminal felony charges from Utah, civil suits in Arkansas and other states, and a stripped federal preemption shield in Ohio and Tennessee. Each state victory erodes the argument that CFTC registration alone blocks state gambling enforcement.
The judge's doubt about CFTC power over retail stock leverage weakens the agency's ability to defend Kalshi uniformly. Platforms like Polymarket US and Robinhood must assume their own federal registrations offer shrinking cover. The CFTC's proposed swap rules remain in White House review, slower than any criminal timeline. Kalshi's founders bear personal legal exposure that most executives will not accept indefinitely.