9th Circuit sides with states in Kalshi gambling fight
https://azmirror.com/2026/08/28/9th-circuit-sides-with-states-in-kalshi-gambling-fight-potentially-reviving-arizonas-prosecution/It doesn't have to be complicated, mind you, but right now the way the law is written is basically:
1. Transmitting sports betting info between states is a federal crime unless it's legal in both states (18 U.S.C. § 1084(a))
2. The CEA regulations ban contracts that are illegal under state law (17 CFR 40.11)
3. Other forms of gambling/betting/contracts that are not sports are generally a-ok.
4. This is not a case of first impression, it's just getting relitigated because Kalshi doesn't want to follow the actual law. This has actually been pretty settled law for a long time, with new flareups maybe once a decade. Kalshi is just hoping to be treated like Uber was.
The third circuit's decision is pretty clearly "out there" in terms of existing caselaw.
However, this will end up at SCOTUS, and everything until then just doesn't matter. That will be a coin flip even though it shouldn't be
Correction: because the federal government doesn't want Kalshi to follow the actual law. CFTC ordered Kalshi to continue operating in NY when NY tried to crack down on it. Donald Trump Jr. is a paid advisor for Kalshi. The US Government's conservative leaders are ignoring states' rights in order to personally profit, using Kalshi as a tool.
> this will end up at SCOTUS, and everything until then just doesn't matter
Unless Congress passes a law so SCOTUS doesn't have to. We can't keep pretending it's normal for SCOTUS to decide everything about our society. If Congress won't do its job, why do we have them?
Incredible that it's taken this long to arrive at the obvious.
Gambling takes advantage of the poor, under-educated, and addictive personalities and puts them into financial distress. This places burden on families, the state, and local municipalities. It creates strain on the workforce and deflects legitimate economic activity that would otherwise strengthen the economy.
We're a free society. I'm fine with gambling from a personal liberty perspective, but the companies that facilitate and profit need to pay 40-50% of their gross revenue to the government. That's comparable to tobacco.
Companies also need to be restricted in how they are able to advertise their vices. Never to children, and never targeted to at-risk personality types.
They also need to be tightly regulated and kept from using dark patterns and addictive gotcha mechanics to cause even greater harm to those most at risk.