Kalshi, an online prediction market, is facing legal challenges from Nevada and New Jersey that claim its operations violate state gambling laws. Kalshi asserts that it is regulated by the Commodity Futures Trading Commission (CFTC) and should not be categorized as gambling. Crypto attorney Aaron Brogan believes Kalshi has a strong case and is likely to win in court due to the exclusive jurisdiction of the CFTC over such contracts. This situation raises significant questions about the balance of state and federal authority over gambling regulations. Brogan notes that if Kalshi prevails, it could dramatically alter the landscape of American sports betting, shifting it toward prediction markets rather than traditional gambling platforms. While Nevada expresses concerns due to its reliance on gambling revenue, Brogan warns that this could inadvertently expose the legal status of Nevada’s own gambling activities as derivative contracts. The outcome of this battle may redefine the regulatory approach to gambling in the digital era and could set a precedent for the future of online gambling.

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