Kalshi Lawsuit Pits States Against Trump Family’s Corruption Machine

On Friday, the U.S. Ninth Circuit Court of Appeals issued a 3-0 ruling against Kalshi, a ruling that in theory gives states the power to regulate the “prediction market” platform. However strong that sounds, one can’t fairly characterize the decision as authoritative. While the San Francisco–based court’s unanimous ruling represents the most significant curtailment of the don’t-call-it-gambling gambling platform, the fight between the Kalshian cohort of bloodsuckers and those who would regulate them is of a larger and stupider nature than even the biggest appeals court in the nation can handle.

We have to start with the odd fact that Kalshi, and the Polymarket prediction market, are presently regulated by the federal government. Not in any meaningful way, of course—befitting a pair of organizations that have each hired Donald Trump Jr. as a “strategic advisor”—but both are technically overseen by the Commodity Futures Trading Commission, a small agency, created in 1974, that typically governs futures markets and other forms of derivatives. The prediction markets’ core argument in the case before the Ninth Circuit is that CFTC oversight is sufficient, which is to be expected given that the scope of that regulatory relationship has amounted to a big thumbs-up in exchange for whatever it costs to buy a Trump son or two.

The CFTC has become a critical arm of the Donald Trump financial crimes apparatus because it has statutory authority to regulate commodities and to classify all sorts of things that are not commodities, like cryptocurrency and online sports bets, as such. This designation lightens the regulatory burden. Securities, by contrast, are subject to stricter rules, which is part of why the Bitcoin people are obsessed with calling the obviously securitized asset digital gold.