Odaily Planet Daily reports that the prediction market platform Kalshi has won a partial preliminary injunction against Illinois. On October 2, U.S. District Judge Martha M. Pacold of the Northern District of Illinois ruled that the state’s sports betting licensing regime and related criminal provisions may be preempted by federal law and may not be enforced against Kalshi at this time.
The court issued a temporary injunction blocking Illinois from requiring Kalshi to hold a state license, which would have restricted traders to those aged 21 and older and located within the state, as well as limited the sports events that contracts could track. The court did not rule on Illinois’s newly established fees for prediction markets.
Pacold stated that the contract regarding the championship winner may constitute a swap under the Commodity Exchange Act and should therefore be traded on a designated contract market and be subject to federal regulation. This determination differs from the August ruling by the Ninth Circuit Court of Appeals, which found that the relevant contract constitutes gambling rather than a swap.
This is Kalshi’s first win in federal court since July. Illinois’ new budget law imposes a 1.75% fee on the first 5 million related trades, followed by a 3.5% fee, plus a 15% fee on total revenue and an additional $0.25 or $0.50 per trade; the court has ordered both parties to submit supplemental briefs on the fee issue. (Bitcoin.com News)