The Second Circuit denied Kalshi and Coinbase’s requests for injunctions that would have prevented New York and Connecticut from enforcing their state gambling laws against sports event contracts while the prediction market operators appeal.
“Upon due consideration, it is hereby ordered that the motions are denied because Appellants have failed to make the required showing that an injunction pending appeal is warranted,” the court order states.
The order did not go into further detail about what the companies failed to demonstrate. The decision means both states could enforce bans against their sports event contracts.
The companies say their sports contracts are swaps covered by the Commodity Exchange Act, putting them under federal Commodity Futures Trading Commission regulation.
New York and Connecticut, like many other states around the country, disagree. They argued that the contracts are essentially sports bets and should be regulated under state gambling laws.
