Prediction markets hit a federal snag

An SDNY judge ruled that New York’s gambling regulations apply to Kalshi’s sports-event contracts, challenging the companies' argument that their platforms operate as futures contracts rather than gambling. The decision supports claims from 16 states that prediction markets like Kalshi and Polymarket threaten state revenue from casinos and gaming, while the companies and CFTC chair Michael Selig argue these markets help corporations hedge business risks.