- There is no single answer yet. Kalshi runs a federally licensed exchange, but New Jersey and Nevada sent it cease-and-desist letters over its sports contracts, Kalshi sued in both cases, and the two federal appeals courts that ruled have disagreed.
- The Third Circuit (New Jersey) found Kalshi has a reasonable chance of showing federal law overrides state gambling law. The Ninth Circuit (Nevada) found Kalshi did not show that.
- Both rulings concern preliminary injunctions, not final decisions, and both are about sports contracts. Whether a given market is open to you depends on your state and on the contract.
- This page reads the two court opinions directly. It does not list which states Kalshi currently serves; check the platform and your state regulator for that.
Is Kalshi legal in all states? The honest answer, as of 2026-10-13, is that the question is being decided in court. Kalshi is a designated contract market, an exchange licensed by the Commodity Futures Trading Commission (CFTC), the federal derivatives regulator. New Jersey and Nevada say its sports contracts are subject to their gambling laws. This page is not legal advice; it summarises what two appeals courts wrote in their own opinions. For background on the product see what prediction markets are.
Is Kalshi legal in all states? Why a federal license does not settle it
Kalshi's argument is that its event contracts are "swaps" under the Commodity Exchange Act, so the CFTC has exclusive jurisdiction and state gambling law is preempted. Preemption means federal law overrides a conflicting state law. The states reply that a contract on a game is a bet, not a financial instrument.
The Third Circuit described Kalshi this way: "Kalshi is a financial services company that operates a designated contract market (“DCM”) licensed by the Commodity Futures Trading Commission (“CFTC”), on which it offers event contracts, a type of derivative." The dispute in both cases below is whether sports contracts on that exchange are swaps.
The two rulings side by side
The table summarises the two appeals-court opinions we read in full. Dates are from the opinions themselves; the table was checked on 2026-10-13.
| Court | Case | Date | State | What the court held |
|---|---|---|---|---|
| Third Circuit | KalshiEX LLC v. Flaherty, No. 25-1922 | Decided April 6, 2026 | New Jersey | Kalshi has a reasonable chance of success on its argument that the Act preempts state law, so the injunction stays |
| Ninth Circuit | KalshiEX, LLC v. Assad, No. 25-7516 | Filed August 28, 2026 | Nevada | Kalshi did not show a likelihood that the Act preempts state gaming regulations as applied to its sports event contracts |
New Jersey: the Third Circuit sided with Kalshi, for now
According to the opinion, New Jersey sent Kalshi a cease-and-desist letter saying its listing of sports-related event contracts violates the state's constitution and gambling laws that prohibit betting on collegiate sports. Kalshi sued, and the district court granted an injunction.
The Third Circuit affirmed. In its words: "Kalshi’s sports-related event contracts are swaps traded on a CFTC-licensed DCM, so the CFTC has exclusive jurisdiction." The court defined the standard it applied as "a reasonable chance, or probability, of winning," which it said means "significantly better than negligible" and does not mean "more likely than not." It is a ruling about whether to keep an injunction in place while the case continues.
Nevada: the Ninth Circuit went the other way
The Ninth Circuit reached the opposite result in a published opinion: "The panel held that the district court did not abuse its discretion in dissolving the preliminary injunction because Kalshi did not show a likelihood that the CEA preempts state gaming regulations as applied to its sports event contracts." That is the court staff's summary of the opinion, which says it constitutes no part of the opinion itself.
The panel also sent part of the case back: it "remanded for the district court to consider Nevada’s challenges to Kalshi’s election contracts consistent with this opinion." So the Nevada dispute is not only about sports. According to the court staff's summary, Judge Lee wrote separately: in that view the statute does not appear to bar all gaming contracts outright, but the question did not need deciding because a CFTC rule (17 C.F.R. § 40.11) currently bars gaming contracts.
What the federal regulator has and has not done
As of its April 6, 2026 opinion, the Third Circuit noted that the CFTC "has not yet acted to review or prohibit any sports-related event contracts," and cited a CFTC notice inviting comment on the scope of "gaming" and "sports competition" (91 Fed. Reg. 12516, proposed March 16, 2026). So a federal rule could change the picture. For the wider rulemaking context see how the CFTC's event contract rules could change what you can trade.
What this means if you are a US user
- Sports contracts are the contested category. Both opinions are about sports event contracts; the Ninth Circuit also returned election contracts to the lower court.
- The answer can differ by state. A court that rules for Kalshi in one state does not bind the rest of the country, and the two appeals courts above disagree. This page covers the two appeals-court opinions we have read in full; it is not a complete list of Kalshi's cases.
- Rulings are preliminary. Both cases were decided on injunction requests, and further appeals or rehearing can follow.
- Check before you trade. Confirm availability in the platform's own help pages and your state gaming regulator's site. Contracts that are not about sports, such as economics or weather markets, were not the subject of these two opinions.
Where this can go wrong
Court decisions move quickly, and this page is a snapshot. A rehearing, a Supreme Court petition or a CFTC rule could change the position after the dates above. A market can also be paused or removed in a state without notice. If your funds are in a market affected by a legal change, read the platform's rules on how positions are settled; our Kalshi review covers the basics. Our own list of alternatives is on the comparison page, and the methodology page explains how we handle sources.
Frequently asked questions
Is it legal to trade on Kalshi?
Kalshi operates an exchange licensed by the CFTC, and a federal appeals court has found it has a reasonable chance of showing that federal law preempts New Jersey's gambling rules. Another appeals court found Kalshi had not shown that for Nevada. So whether trading sports contracts is lawful depends on how the courts finally rule.
What states is Kalshi legal in?
The two opinions we read concern New Jersey and Nevada only. We do not publish a state-by-state availability list because we have no primary source that keeps one current; check Kalshi's help pages and your state regulator.
Is Kalshi legal in the US?
Kalshi is licensed as a designated contract market by the CFTC, per the Third Circuit's description of it. The open legal question is whether states can also apply their gambling laws to its sports contracts; where the courts have not ruled, the position for your state may be unsettled.
The short version
"Legal in all states" is not something any court has declared for Kalshi's sports contracts, and two appeals courts have already disagreed about it. Treat the platform's availability in your state as the practical test, and watch for the next ruling. For the bigger picture, start with what prediction markets are, and see how another venue handles the same questions in our PredictIt review.