Kalshi’s latest news cycle is dominated by federal rulemaking, state-level legal fights, tighter compliance controls, and a major sports data partnership.
CFTC Moves Toward a Prediction Market Rulebook
The Commodity Futures Trading Commission has published a proposed rulemaking for event contracts, a move that could reshape how Kalshi and other prediction market operators list sports-related markets. The proposal would amend CFTC Regulation 40.11 and add a new framework for reviewing contracts tied to terrorism, assassination, war, gaming, or unlawful conduct.
The CFTC said it has seen growth in event contracts, including those tied to sporting events, and wants a clearer process for deciding when contracts are contrary to the public interest. Public comments are due by July 27, 2026.
Axios reported that the proposal would allow many broad sports event contracts, including markets on final scores, point differentials, win-loss results, tournament advancement, and season-long performance metrics. The proposed limits would bar markets tied to injuries, officiating decisions, physical fights, pre-collegiate sports, and highly specific in-game actions.
Kalshi Adds New Insider Trading Controls
Kalshi has rolled out new compliance measures aimed at insider trading and market manipulation risks. Reuters reported that the company will require employment disclosures for users trading sensitive contracts and will launch a whistleblower portal. The changes follow recommendations from an independent Surveillance Audit Committee.
The company also plans to assign risk scores to markets based on factors such as corporate performance, product launches, national security implications, outcome concentration, and manipulation risk. Users will be able to flag suspicious trading directly from market pages, while Kalshi says a surveillance team will monitor activity around the clock.
Kentucky Tax Challenge Opens a New Legal Front
Kalshi has joined Crypto.com, Polymarket, and others in a lawsuit challenging Kentucky’s new 14.25% excise tax on prediction market operators’ transaction fees. AP reported that the lawsuit argues the tax is discriminatory, unconstitutional, and preempted by federal law. Kentucky’s attorney general, Russell Coleman, said his office will defend the law.
The case adds a tax fight to the broader state-versus-federal battle around prediction markets. The lawsuit says no state currently imposes a state-specific excise tax on derivatives transactions carried out on a federally designated exchange. Kalshi said taxing federally regulated markets pushes activity toward illegal platforms.
CFTC Sues New Mexico Over Kalshi Action
The CFTC has also sued New Mexico after the state filed its own action against KalshiEX LLC. New Mexico alleged that Kalshi’s prediction market offerings amount to unlawful online sports betting and sought to halt the company’s operations in the state.
The CFTC’s complaint seeks a declaration that federal law gives it exclusive authority over event contracts and asks for an injunction blocking New Mexico from enforcing state gaming laws against CFTC-registered contract markets. The agency said New Mexico joins a growing list of states attempting to regulate CFTC registrants, including Arizona, Connecticut, Illinois, New York, Minnesota, Rhode Island, and Wisconsin.
Sportradar Partnership Strengthens Sports Infrastructure
Kalshi has signed a multi-year global partnership with Sportradar, positioning the sports technology firm as an official data and solutions provider for Kalshi. Sportradar said the agreement covers major properties including MLB, NHL, MLS, and UFC.
The deal gives Kalshi access to official sports data, live odds, fan engagement tools, customer acquisition services, and integrity products. Sportradar also said the agreement allows it to work directly with Kalshi’s ecosystem partners, including brokers and market makers.
Advertising Watchdog Refers Kalshi to Regulators
Kalshi is also facing pressure over advertising practices. BBB National Programs’ National Advertising Division said it will refer Kalshi to regulatory authorities after the company declined to participate in an inquiry. The review focused on whether material connections between Kalshi and influencers or affiliates were clearly disclosed in social media advertising, and whether Kalshi took adequate steps to comply with FTC endorsement guidance.
The Big Picture
Kalshi is moving deeper into the center of the U.S. prediction market debate. The company is gaining infrastructure and possible regulatory clarity through the CFTC process, while state lawsuits, tax disputes, advertising scrutiny, and insider trading concerns continue to pile up. The next key date is July 27, 2026, when comments close on the CFTC’s proposed rulemaking.
