New York challenges CFTC swaps rule Kalshi cites in state fights
New York told a federal judge that a CFTC swaps proposal deserves no weight, court records show. Kalshi has cited the same rule in filings in Louisiana and the Sixth Circuit, according to Next Predict. The state challenge comes as Kalshi promotes itself as the first federally regulated exchange where users can legally trade on anything, in a video recounting its late 2024 CFTC victory on political event contracts. The sources do not detail the proposal's substance or Kalshi's specific claims in those filings.
The New York filing drains leverage from the CFTC swap rule Kalshi is using to fend off state gambling suits. If courts treat the proposal as weak or irrelevant, Kalshi loses a key argument in Louisiana and the Sixth Circuit, where it is already trying to reverse losses.
That narrows Kalshi's playbook while the Supreme Court decides whether to take its sports-contracts case. Meanwhile the CFTC rule itself remains in slow-motion review, outpaced by state court clocks. Kalshi's dual bet on federal rulemaking and federal preemption is fraying, forcing harder choices between fighting state by state or retrenching to geofenced markets.
Adds New York to the lengthening roster of state actors resisting federal preemption claims, joining Ohio, Tennessee, and Missouri in breaking down the CFTC-registration shield that Kalshi's Tradeweb and BMLL institutional push now partly relies on for credibility.