Case: 25-7516, 01/23/2026, DktEntry: 33.1, Page 27 of 110
tracts, 89 Fed. Reg. 48968, 48976 (proposed June 10, 2024). And when com-
panies like Kalshi began offering sports betting on DCMs, the CFTC em-
phasized it has not “taken any official action” to approve those contracts and
warned the companies that they could be subject to state regulatory action.
1-StateSER-41 & n.4.
B. Factual Background Kalshi operates a CFTC-registered DCM where users can buy “event
contracts” on sports, elections, and other events. 2-ER-110 (¶¶ 42-44).
Those contracts are wagers: The user buys a contract on whether a partic-
ular outcome will occur and receives a payout if it occurs. 2-ER-105 (¶ 25).
In 2023, Kalshi began offering contracts on the outcomes of elections. 2-ER-
110-11 (¶¶ 45-47). In January 2025, Kalshi began offering contracts on the
outcomes of sports events. 2-ER-110-12 (¶¶ 45, 53).
Kalshi initially offered sports contracts only on the winners or losers
of games, but since has expanded to “prop” bets (bets on outcomes within a
game, such as the winning margin or total number of points scored) and
“parlays” (chained bets on two or more outcomes). See Marc Novicoff, The
Company Making a Mockery of State Gambling Bans , Atlantic (Oct. 26,
2025), perma.cc/8TAG-NJSJ. For example, on January 7, 2026, a Kalshi
user could buy a contract for $0.18 that would pay $1 if the Panthers won
their playoff game against the Rams. Kalshi, Los Angeles at Carolina ,
perma.cc/2YHT-SRVH (visited Jan. 7, 2026). The user also could bet on the
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