Federal Ruling Raises Risk for Polymarket, Kalshi in Nevada

TheNewsCryptoPublished on 2026-03-03Last updated on 2026-03-03

Abstract

A US federal court ruling has increased the risk that Nevada regulators may halt prediction-market trading in the state. The court rejected arguments that federal commodity regulations preempt state gaming laws, allowing the Gaming Control Board to pursue its case against Polymarket’s parent company, Blockratize, in state court. This could lead to an injunction preventing Nevada residents from accessing event contracts offered by Polymarket or Kalshi. The decision comes amid growing regulatory pressure on prediction markets, with Kalshi also facing a similar state-level enforcement action. Legal experts suggest the ruling may encourage other states to seek injunctions against event contracts.

The US federal court ruling has pushed the risk even higher that Nevada regulators could look for halting prediction-market trading in the state after a judge sent a contest comprising Polymarket’s parent company, Blockratize, back to state court.

A federal judge declined arguments that US regulation under the Commodity Exchange Act (CEA) and the Commodity Futures Trading Commission (CFTC) completely prevents state gaming laws for prediction markets, as per a Monday order.

The judge found that the savings clause of the CEA does not fully replace state authority and that the firms had not revealed a basis to obstruct the action of Nevada at this stage. The decision shows the Nevada Gaming Control Board can carry on going after its civil enforcement case in state court, where it could look for an injunction limiting Nevada residents from accessing event contracts provided by Polymarket or Kalshi.

Decision Amid The Increasing Pressure

With regards to the ruling, the parent company of Polymarket submitted a motion to request a brief administrative stay of the remand order of the court. The motion is a legal request looking to freeze a court ruling or enforcement action witnessed as a short-term emergency measure.

The Nevada decision comes amid the increasing pressure on prediction markets from state regulators, including Kalshi, which has been fighting Nevada’s gaming regulator since 2025.

A federal judge on March 3 also remanded the civil enforcement action of Nevada against Kalshi back to the state court, exposing Kalshi to an imminent temporary restraining order excluding it from providing event contracts in the state, as per a court filing witnessed from sports betting and gaming-aimed lawyer Daniel Wallach.

Today, Wallach posted on X mentioning that the ruling could encourage other states to sue Kalshi in state court and look for injunctions to hinder event contracts, a strategy that has already succeeded in every case brought.

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TagsFederal CourtKalshiPolymarket

Related Questions

QWhat is the main implication of the federal court ruling for Polymarket and Kalshi in Nevada?

AThe ruling increases the risk that Nevada regulators could halt prediction-market trading in the state, as it allows the Nevada Gaming Control Board to pursue its civil enforcement case in state court and potentially seek injunctions to restrict Nevada residents from accessing event contracts offered by Polymarket or Kalshi.

QWhich federal laws did the judge rule do not completely preempt state gaming laws for prediction markets?

AThe judge ruled that the Commodity Exchange Act (CEA) and the Commodity Futures Trading Commission (CFTC) regulations do not completely preempt state gaming laws for prediction markets, as the savings clause of the CEA does not fully replace state authority.

QWhat action did Polymarket's parent company take in response to the court's remand order?

APolymarket's parent company, Blockratize, submitted a motion requesting a brief administrative stay of the court's remand order, which is a legal request to freeze the ruling or enforcement action as a short-term emergency measure.

QHow has the ruling impacted Kalshi specifically, according to the article?

AThe ruling exposed Kalshi to an imminent temporary restraining order that would exclude it from providing event contracts in Nevada, as a federal judge also remanded Nevada's civil enforcement action against Kalshi back to state court on March 3.

QWhat broader consequence might this ruling have for prediction markets in other US states, as suggested by lawyer Daniel Wallach?

ADaniel Wallach suggested that the ruling could encourage other states to sue Kalshi in state court and seek injunctions to hinder event contracts, a strategy that has already succeeded in every case brought.

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