Sixth Circuit rules Kalshi sports contracts are gambling, lets Ohio and Tennessee enforce betting laws
The Sixth Circuit Court of Appeals ruled unanimously Friday that Kalshi's sports event contracts are not swaps under federal commodities law. The decision lets Ohio and Tennessee enforce their sports betting laws against the platform and reverses a lower-court victory that had allowed Kalshi to offer sports contracts nationally. The ruling deepens a split among federal appellate courts over state authority to police prediction-market platforms.
Kalshi's federal preemption shield is gone in the Sixth Circuit. The ruling forces the platform to comply with Ohio and Tennessee gaming laws or geofence both states, and every other state in the circuit can now follow the same path. Robinhood and Crypto.com face identical exposure, which is why both joined the Supreme Court petition chorus after the Circuit losses.
Legal spend compounds across parallel cases faster than any single resolution. The first state to win on the merits becomes precedent every other gaming commission copies. Kalshi's cert gamble is now a survival bet for any platform offering sports-linked contracts.
The Sixth Circuit ruling marks Kalshi's second federal appellate loss in three days, after the Circuit blocked its contracts on two California tribal lands, collapsing its nationwide preemption theory across multiple circuits simultaneously.