Case: 25-7516, 01/23/2026, DktEntry: 33.1, Page 68 of 110
Kalshi cannot rely on the Special Rule to authorize sports betting on
DCMs when the CFTC has exercised its authority under the Rule to cate-
gorically ban “gaming” on DCMs. 17 C.F.R. § 40.11(a). Kalshi also cannot
rely on the Special Rule to support CFTC jurisdiction over its election con-
tracts, because its position (Br. 38) is that the CFTC cannot regulate elec-
tion contracts at all under the Special Rule.
Kalshi’s remaining arguments miss the mark because they do not ad-
dress whether the CEA preempts gaming regulation. Kalshi argues that
the CEA’s history and case law show that Congress intended for the CEA to
preempt state regulation of commodity-futures markets, and that the CEA
contains a comprehensive scheme for regulating commodity-futures trad-
ing. Kalshi Br. 29-35; see Paradigm Amicus Br. 5-21. But the decisions
Kalshi cites address bona fide commodity derivatives; none addresses sports
wagers “guised” as commodity derivatives. Crypto.com , 2025 WL 2916151,
at *11. Further, the decisions that “carefully focused on the scope of Con-
gress’s preemptive intent” recognized “that intent had limits.” Martin , 793
F. Supp. 3d at 682; see, e.g. , Am. Agric. Movement, Inc. v. Bd. of Trade of
City of Chi. , 977 F.2d 1147, 1156 (7th Cir. 1992) (concluding that the CEA
preempts only state laws that “directly affect trading on or the operation of
a futures market”—which Nevada’s licensing requirements do not).
Kalshi’s cited materials simply do not show that Congress intended to
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