Third Circuit Rules 2-1 for Kalshi, Blocking New Jersey Gambling Enforcement

The Third Circuit ruled 2-1 for Kalshi, upholding a preliminary injunction that bars New Jersey from enforcing state gambling laws against Kalshi’s sports event contracts.

The court held Kalshi’s sports-related contracts qualify as swaps under the Commodity Exchange Act and are traded on a CFTC-licensed DCM, triggering federal preemption.

One judge dissented, saying the products resemble traditional sports betting; the ruling binds only the Third Circuit while further appeals or other circuits could differ.