In a landmark decision, a federal appeals court ruled that New Jersey gaming regulators cannot restrict Kalshi, a prediction market platform, from allowing users in the state to place financial bets on sports outcomes. The ruling, decided by a 2-1 vote from the Philadelphia-based Third Circuit Court of Appeals, found that the US Commodity Futures Trading Commission (CFTC) holds exclusive jurisdiction over the sports-related event contracts Kalshi offers. This decision marks a pivotal moment in the ongoing debate over the regulatory authority of state gaming regulators versus federal oversight. Kalshi's CEO, Tarek Mansour, celebrated the ruling as a significant win for the industry and its users. The court's majority opinion indicated that Kalshi's event contracts qualify as 'swaps' under the Commodity Exchange Act, which can only be regulated by the CFTC. This aligns with the CFTC's previous actions against states attempting to impose their regulations on prediction markets. However, dissenting Judge Jane Richards Roth argued that Kalshi's offerings closely resemble traditional gambling products. In light of the ruling, New Jersey Attorney General Jennifer Davenport stated her office is evaluating options, including the possibility of seeking a rehearing of the case. The implications of this ruling could influence similar cases pending in other jurisdictions.