New Jersey asks Supreme Court to rule on prediction markets

Millions of Americans now bet on sports outcomes through apps like Kalshi, without calling it gambling. New Jersey wants that to stop, at least under its own rules. On Sept. 2, New Jersey's attorney general asked the U.S. Supreme Court to settle the fight. Does a federal commodities law let these apps skip state gambling law entirely? Or must they follow it, like any casino or sportsbook?

The fight started because a federal appeals court just sided with Kalshi. That court ruled sports-related prediction contracts aren't 'swaps.' That means they don't fall under the CFTC, the federal regulator for commodities trading. New Jersey argues that ruling lets these platforms dodge state consumer protections. Those are the same protections that apply to every other form of sports betting. If the Supreme Court agrees to hear the case, the outcome matters a lot. It could decide whether prediction markets answer to all 50 states, or just to Washington.

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Will the Supreme Court even take the case? The justices accept only a small fraction of petitions filed each year. There's no guarantee this one makes the cut. New Jersey isn't alone in this fight, either. A separate Michigan court order is already forcing Kalshi to block sports contracts there. That's while the bigger legal question gets sorted out. If the Court does take it up, the ruling could set the rules for good. That would apply to the entire prediction-market industry, not just Kalshi.