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Yesterday, the CFTC intervened in the New York v. Kalshi case, using its emergency authority to order Kalshi to continue operating in accordance with federal law, saying New York cannot use gambling laws to shut down a federally regulated exchange.
- New York vs. Kalshi: New York sued Kalshi on July 31, alleging the prediction market is operating an illegal gambling business and seeking an order that could prohibit it from offering event contracts nationwide.
- Kalshi Calls in the CFTC: In response, Kalshi notified the CFTC that New York’s lawsuit constituted a market emergency, prompting the regulator to invoke its emergency authority and direct Kalshi to continue operating, arguing that allowing individual states to shut down the platform would undermine its federal jurisdiction and create a patchwork of conflicting state rules.
- Emergency Powers, Again: This marks the second time this summer the CFTC has used its emergency authority to protect Kalshi from a state-level intervention. In July, after a Michigan court ordered Kalshi to unwind certain trades, the regulator stepped in and directed the exchange to fulfill them instead.
.@CFTC Exercises Emergency Authority to Ensure Market Stability: https://t.co/FlXLiV3WPe
— CFTC (@CFTC) August 11, 2026
