Case 2:25-cv-00575-APG-BNW Document 237 Filed 11/24/25 Page 17 of 29
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expressed congressional intent to do so, with no federal gaming regulator to replace the states’ regulatory infrastructures, and contrary to the expressed congressional intent that CFTC exchanges should not become sports gambling venues. See Crypto , 2025 WL 2916151, at *6. I noted in my Crypto order that the broad interpretation of swaps that Crypto (and Kalshi and Robinhood) are promoting “would sweep nearly all sports wagering into the CFTC’s exclusive jurisdiction even though the states historically have regulated gambling through their police power.” Id. at *9. That is so because “nearly every sports bet would be a transaction in which payment is dependent on the outcome of a sporting event and is associated with a potential financial, economic, or commercial consequence.” Id. (footnote omitted). That “cannot be a proper reading of the statute because that would mean that all sports wagering must be done on a DCM, and not at casinos, as the CEA forbids nearly all swap dealing and trading unless done on a DCM, except for certain market participants, none of whom are casinos or the average sports bettor.” Id. (footnote omitted). As I stated in Crypto , “[h]ad Congress intended such a sea change in the regulatory landscape, it surely would have said so. The CEA’s language and legislative history show that Congress did not intend such a change and, to the contrary, did not want gambling to take place on CFTC-designated exchanges.” 2025 WL 2916151, at *10 (simplified). Kalshi argues that wagers at sportsbooks are not swaps falling within the CFTC’s jurisdiction because the CEA covers products traded on an exchange, and “once a gambler places a bet with a sportsbook in Nevada, neither the gambler nor the sportsbook can sell that bet to anyone else on any organized exchange.” ECF No. 184 at 17. I have no evidence before me that sports wagers are not tradeable. But even if they are not, being tradeable is not included in the CEA’s definition of a swap. Instead, the CEA defines a swap and states that if something is a
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