CFTC Drops Enforcement Case Against Kalshi Sports Markets
The CFTC ended its legal challenge to Kalshi's sports event contracts, confirming Kalshi can offer sports outcomes as regulated event contracts under its DCM licence. A landmark ruling for regulated prediction markets.
The US Commodity Futures Trading Commission (CFTC) formally dropped its enforcement action against Kalshi's sports event contracts in May 2025, ending a legal dispute that began when the agency challenged whether sports outcome contracts were permissible under Kalshi's Designated Contract Market licence.
Kalshi had launched sports contracts in late 2024, arguing that the CFTC's own self-certifying process for DCM products permitted the markets under its existing licence. The agency disagreed and sought to block the sports contracts, setting up a court battle. Kalshi prevailed at the district court level, and the CFTC subsequently withdrew its appeal in May 2025.
The ruling has industry-wide implications. It confirmed that a fully CFTC-regulated exchange can offer sports outcome event contracts, opening a legal pathway for other CFTC-licensed entities (like Robinhood's future exchange and Novig's pending DCM application) to list similar products. It also reinforced that the DCM self-certification process, not CFTC pre-approval, governs what products a licensed exchange can list.
For US sports bettors, the practical impact was immediate: Kalshi expanded its sports coverage to include more leagues, more contract types, and eventually NFL parlays in partnership with Robinhood. Sports contracts are currently available in 35+ US states, with New Jersey a notable exception due to the state's own regulatory position on federally-licensed event contracts.
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Recent updates
Missouri AG Sends Cease-and-Desist Letters to Six Prediction Market Operators
Missouri Attorney General Catherine Hanaway issued cease-and-desist letters on September 18 to six prediction market operators — Kalshi, Polymarket, Robinhood, Crypto.com, Novig, and Underdog — alleging their sports event contracts constitute unlicensed sports wagering under Missouri law. The letters give platforms 30 days to comply or obtain licenses from the Missouri Gaming Commission. Missouri is the broadest multi-platform C&D action to date, targeting all major operators simultaneously. The action arrives one day after Montana and Kalshi filed a joint stipulation in which Montana agreed to pause enforcement while Ninth Circuit en banc review is pending.
Yahoo Finance Ends Polymarket Data Partnership After Five Months
Yahoo Finance and Polymarket mutually ended their prediction market data partnership on September 18, approximately five months after the companies announced an exclusive arrangement in November 2025. The Polymarket data hub that Yahoo Finance launched in January-February 2026 was quietly taken down in April 2026. No reason was publicly disclosed. Yahoo Finance retains an advertising relationship with Polymarket. The partnership's end is a setback for Polymarket's strategy of embedding its probability data into mainstream financial media platforms.
Montana and Kalshi Reach Joint Stipulation — State Pauses Enforcement Pending Ninth Circuit En Banc
Kalshi dismissed its lawsuit against the Montana Department of Justice on September 17 after both sides filed a joint stipulation in which Montana agreed to pause all enforcement, investigations, and cease-and-desist proceedings against Kalshi's event contracts. The pause lasts until the Ninth Circuit either denies en banc review of the August 28 ruling or issues an en banc decision. Montana must give Kalshi 30 days written notice before resuming any enforcement action after that window closes. The agreement mirrors the Robinhood-Michigan stipulation from September 4 and reinforces a pattern of states reaching negotiated compliance pauses while the appellate process plays out.