USCA4 Appeal: 25-1892
Doc: 16
Filed: 10/15/2025
Pg: 33 of 97
In December 2024, one of Kalshi’s competitors began offering
contracts on the outcomes of sports events. JA44. Kalshi followed suit in
January 2025. JA44. Kalshi’s contracts allow users to place positions on, for
example, which teams will advance in the NCAA College Basketball
Tournaments or who will win the U.S. Open Golf Championship. JA44. The
Special Rule authorized the CFTC to review Kalshi’s sports -event contracts if
it concluded they involved “gaming” and prohibit them if it found them
“contrary to the public interest.” 7 U.S.C. § 7a-2(c)(5)(C)(i). To date,
however, the CFTC has declined to initiate review of Kalshi’s sports -event
contracts. JA44. Thus, upon self-certification, these contracts were
approved under federal law. 7 U.S.C. § 7a-2(c)(1).
When Congress in 2010 listed contracts involving “gaming” among the
categories of contracts the CFTC could review for compliance with the public
interest, a federal statute called the Professional and Amateur Sports
Protection Act ( “ PASPA ” ) made sports betting unlawful in nearly every state. See 28 U.S.C. § 3702(1). In Murphy v. NCAA , 584 U.S. 453, 486 (2018), the
Supreme Court invalidated PASPA. Since then, most states — including
Maryland — have authorized sports betting.
Kalshi ’s sports-event contracts differ from bets offered by sportsbooks
in important respects. Unlike a traditional casino or “house,” Kalshi ’s
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