CFTC Seeks 14-Day Stay After Defeat in Court to Kalshi
The Commodity Futures Trading Commission seeks a federal judge’s order to restrain the U.S. prediction market platform Kalshi from listing any election markets for a period of 14 days. The motion emerges in emergency just hours after the Commodity Futures Trading Commission lost a high-profile court fight.
Kalshi Wins Court Case Against CFTC
U.S. District Judge Jia M. Cobb, in her ruling handed down on Friday, granted the motion of Kalshi to partial summary judgment in its lawsuit filed against the regulatory agency. Kalshi sued the regulatory body after it was barred from offering contracts related to the outcome of US elections. The CFTC had argued that such markets were unlawful gaming, alongside being contrary to public interest. However, Kalshi replied that the CFTC’s move was “arbitrary [and] capricious” in nature.
Although the judge ruled in favor of Kalshi, she did not provide a detailed reasoning for why she has done so, and said that her complete explanation would be published in an opinion that will come out shortly.
CFTC Seeks More Time to Consider Appeal
It has now responded to the ruling with an emergency motion to stay Judge Cobb’s opinion for at least 14 days after the publication date, stating that without access to the judge’s reasoning it can’t make an “informed decision” on how to proceed-whether to appeal the ruling or move forward with other legal options.
Without the benefit of the Court’s reasoning, the CFTC is unable to make an informed decision whether to appeal, nor is it able to fully brief a motion for stay pending any forthcoming appeal,” the agency said in its filing.
What Happens Next?
This would push Kalshi’s planned election contracts at least two more weeks, likely well into late September, if granted. The delay would be significant, in that it would prevent the company from capitalizing on the current U.S. election betting boom-a space now dominated by cryptocurrency-based Polymarket, which itself is restricted from serving U.S. residents under a settlement with the CFTC.
To date, Kalshi has made no comment on the CFTC’s emergency motion.
Conclusion
For the time being, the fight between the CFTC and Kalshi continues to unfold, as each party keeps watch but waits for the judge’s complete, in-depth opinion. Meanwhile, the CFTC works to pull every lever it can to stand in the way of the election contracts going live and perhaps set up even more clashes in court.
