Kalshi Triumphs in Legal Battle Against CFTC, Cleared to Offer Congressional Prediction Markets
In a significant development for the prediction market industry, Kalshi, a U.S.-regulated platform, has won its federal lawsuit against the Commodity Futures Trading Commission (CFTC). This victory allows Kalshi to offer contracts on which party will control each house of Congress after the November 2024 election. Court Order
TL;DR:
1. Legal Victory: Judge Jia M. Cobb of the U.S. District Court for the District of Columbia ruled in favor of Kalshi on September 6, 2024, vacating the CFTC's previous order that prohibited the platform from listing congressional control contracts.
2. Background: The CFTC had initially forbidden Kalshi from offering these contracts in September 2023, citing concerns about unlawful gaming and public interest. CFTC Ruling
3. Market Implications: Now on the heels of the upcoming November elections, Kalshi has been cleared by the CFTC to participate in the political prediction market, which has been dominated by crypto-based platforms like Polymarket.
Washington, D.C. — The Commodity Futures Trading Commission announced today it has issued Kalshi Klear LLC (Kalshi) an Order of Registration as a derivatives clearing organization (DCO) under the Commodity Exchange Act (CEA).
The CFTC determined Kalshi demonstrated its ability to comply with the CEA provisions and CFTC regulations applicable to DCOs. The terms and conditions of the DCO order requires, among other things, that Kalshi will comply with all provisions of the CEA and the CFTC’s regulations applicable to DCOs.
Kalshi’s affiliate, KalshiEx LLC, is registered with the CFTC as a designated contract market. CFTC Press Release