Federal Ruling Raises Risk for Polymarket, Kalshi in Nevada

• A federal judge on March 3 also remanded the civil enforcement action of Nevada against Kalshi back to the state court.
• The Nevada decision comes amid the increasing pressure on prediction markets from state regulators

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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