The Major League Baseball Players Association (MLBPA) is open to stopping players from appearing in personalized sportsbook marketing connected with VIP or tier programs. At the same time, it wants MLB to support wider restrictions on some bets tied to events during games.

MLBPA General Counsel Jeffrey Perconte outlined that position in an August 24 response to Sen. Richard Blumenthal and Reps. Paul Tonko and Valerie Foushee. The lawmakers had written to the union on August 10 after a personalized Bryce Harper video was reportedly sent to a FanDuel VIP customer struggling with gambling addiction.

The issue has become part of collective bargaining between MLB and the union, including negotiations over the Sports Betting Policy covering players. The MLBPA believes players should retain opportunities for sportsbook endorsements similar to commercial relationships involving MLB and its clubs, but says those deals need boundaries.

“We do not believe the ability of players to enter into such agreements should be unlimited, however,” Perconte wrote. “For example, we are prepared to support CBA restrictions that ban players from participating in personalized marketing campaigns connected to a VIP or tier program.”

MLBPA backs VIP marketing ban, seeks wider in-game betting limits

Beyond advertising, the MLBPA wants the league to help pursue restrictions on proposition bets and event contracts determined by in-game performance. Its proposal could cover wagers involving hits, runs, home runs, individual pitches or at-bats and whether a player suffers an injury.

“And while MLB has thus far rejected this proposal, we intend to continue pursuing it,” Perconte wrote.

The union returned to that dispute when addressing whether fan protection should come before gambling revenue.

“MLB has thus far balked, but negotiations remain ongoing and players intend to continue to push this proposal,” the MLBPA said.

MLB has previously acted on narrower microbetting concerns. In November 2025, authorized gaming operators began limiting pitch-level wagers to $200 and excluding those bets from parlays, after the league said such markets created heightened integrity risks.

Under the Sports Betting Policy negotiated in 2022, players cannot wager on baseball, arrange prohibited bets through others, knowingly benefit from impermissible wagers or provide confidential information for betting purposes. A 2025 supplement clarified that baseball prediction markets are also covered. Several players suspended in 2024 for betting-policy violations were reinstated after serving their penalties.

Sportsbook promotions remain permitted in some circumstances, and the union says most player-related campaigns use names, images, highlights or photographs passively. Existing rules, however, do not specifically address VIP programs.

“Our current policies do not explicitly reference or otherwise address the types of ‘predatory VIP programs’ described in your August 10th letter,” Perconte wrote. “The Association stands ready to make proposals in an effort to fill that gap.”

The MLBPA also plans to add personalized-marketing risks to its regular player education on addiction, mental health and prohibited conduct.

“As noted above, the Association is willing to adopt new restrictions banning player participation in personalized marketing campaigns that operate as part of a VIP or tier program,” Perconte wrote.

Featured image: Canva

The post MLB players union backs VIP sportsbook marketing ban amid CBA talks appeared first on ReadWrite.

Matt Gogel will spend six months away from PGA Tour-sanctioned competition after the Tour determined that the PGA Tour Champions member had been betting on golf competitions.

The PGA Tour announced the discipline Wednesday (August 26), saying Gogel broke its Integrity Program by wagering on PGA Tour competition. The organization said none of those bets involved a tournament in which Gogel was competing.

His suspension took effect August 23, 2026, and will remain in place through February 22, 2027. Until that penalty ends, Gogel is barred from playing in events sanctioned by the PGA Tour.

Details about which competitions drew Gogel’s wagers were not disclosed. The Tour also gave no information about the individual bets, although it said Gogel fully cooperated with the process that resulted in the suspension.

Matt Gogel says PGA betting involved small wagers on events he did not play

In his own statement, Gogel acknowledged betting on golf during 2024 and 2025. He characterized the wagers as small recreational bets and said he had not realized they ran afoul of Tour policy.

“In 2024 and 2025, I unknowingly violated the PGA TOUR policy by placing small recreational wagers on golf. I want to be clear that these wagers were not placed on regular PGA TOUR events, PGA TOUR Champions events or any tournament in which I participated.

“I would never knowingly violate the integrity of the game of golf. I made an honest mistake and I look forward to playing in 2027 on the PGA TOUR Champions.”

The wording of the two statements leaves a distinction that neither side explained further. In announcing its finding, the Tour described Gogel’s bets as wagers on “PGA TOUR competition.” Gogel, meanwhile, specifically ruled out regular PGA Tour tournaments, PGA Tour Champions tournaments and any event where he was part of the field.

Neither statement offered further details that would clarify what competitions fell within that difference in terminology.

With the six-month sanction now underway, Gogel will miss PGA Tour-sanctioned competition through the rest of 2026. His ineligibility carries into February before ending ahead of his possible return later in 2027.

Betting conduct for people subject to PGA Tour rules is covered by the organization’s Integrity Program. The Tour concluded Gogel’s activity violated those restrictions despite its finding that he never wagered on an event he played.

Gogel accepted that he made the bets while maintaining that he was unaware they were prohibited. He also emphasized that he would never deliberately do anything that threatened golf’s integrity.

The disciplinary decision became public August 26, which was three days after the suspension had already started. Once the penalty expires in February, Gogel plans to resume competing on PGA Tour Champions in 2027.

Featured image: mutualgolf via YouTube

The post Matt Gogel suspended six months after betting on PGA Tour competitions appeared first on ReadWrite.

Connecticut is suing Kalshi, asking a state court to stop the prediction market from offering sports contracts to residents without a gambling license.

Attorney General William Tong announced the lawsuit Wednesday alongside Department of Consumer Protection Commissioner Bryan T. Cafferelli and Gov. Ned Lamont. Connecticut wants an injunction blocking Kalshi from continuing to offer contracts that officials consider unlicensed sports betting.

On Kalshi’s exchange, customers trade yes-or-no contracts tied to future events. Its sports markets can involve game and season winners, league standings, win totals, point spreads, scores and individual player statistics.

State officials argue those products function as sports wagers, meaning Kalshi must follow Connecticut’s gambling licensing requirements and consumer safeguards. According to the complaint, Kalshi has made sports contracts available to Connecticut residents through its website, app and other channels since January 2025 without obtaining or seeking a Department of Consumer Protection license.

“Sports event contracts are no different than sports betting and are not magically shielded by federal law from Connecticut’s commonsense consumer protection laws,” said Attorney General Tong.

Connecticut sues Kalshi as federal challenge fails to halt gambling enforcement

Connecticut regulators sent cease-and-desist notices to Kalshi, Robinhood and Crypto.com in December 2025, accusing the platforms of offering unlicensed online gambling.

Regulators told the companies to stop promoting or providing sports event contracts and other unauthorized gambling products in Connecticut. The orders also required them to allow customers in the state to withdraw money from their accounts.

Kalshi sued Connecticut in response, arguing that its event contracts are federally regulated derivatives and that the Commodity Futures Trading Commission has exclusive authority over them under the Commodity Exchange Act.

U.S. District Judge Vernon Oliver rejected Kalshi’s request for a preliminary injunction earlier in August. Kalshi appealed to the Second Circuit and sought temporary protection from Connecticut enforcement while that appeal proceeded.

On August 19, Circuit Judge Sarah A. L. Merriam denied that temporary request. The appeals court left Kalshi’s broader injunction motion for a three-judge panel to consider and did not decide the underlying dispute.

The CFTC has separately sued Connecticut and two other states, similarly arguing that federal law gives the commission exclusive authority over prediction markets. Connecticut has moved to dismiss that case.

Connecticut’s latest complaint also takes aim at Kalshi’s marketing. Officials allege the company characterized its activities as “legal in all 50 states” while presenting sports contracts as both investments and lawful alternatives to licensed sportsbooks.

The state says its gambling framework provides protections covering minors, problem gambling, customer money and personal data. Connecticut legalized regulated sports betting in 2021.

Featured image: Kalshi / Canva

The post Connecticut sues Kalshi over sports contracts offered without state gambling license appeared first on ReadWrite.

Novig and New Mexico officials want to pause their federal court battle over sports event contracts until August 2027, giving another case time to address a legal issue at the heart of their dispute.

Ludlow Exchange LLC, which operates as Novig, joined the New Mexico defendants in asking the U.S. District Court for the District of New Mexico on Tuesday (August 25) to stay proceedings through August 13, 2027. Novig sued Attorney General Raul Torrez and New Mexico Gaming Control Board members on August 6 for declaratory and injunctive relief.

The filing, seen by ReadWrite, came after discussions on August 17 and August 20. Novig said it planned to seek a preliminary injunction unless both sides could arrange a temporary pause.

A separate Commodity Futures Trading Commission lawsuit against New Mexico is driving that request. The CFTC sued on June 12 and sought a preliminary injunction six days afterward. Injunction briefing finished July 30, followed by briefing on the defendants’ dismissal motion on August 7.

CFTC lawsuit puts Novig dispute with New Mexico and Massachusetts on hold

Both sides expect the CFTC litigation to address federal preemption, which also sits at the center of Novig’s case. They said a stay “would promote judicial economy and limit duplicative litigation.”

New Mexico would also hold off on specified enforcement during the pause. Officials said they “will not initiate, pursue, or maintain any civil or criminal enforcement action” over Novig listing sports-related event contracts on its designated contract market until at least 14 days after the stay finishes.

By July 30, 2027, both sides would tell the court whether the pause should continue. Once it ends, they would have 14 days to suggest a briefing schedule, while state officials would get 60 days to respond to Novig’s complaint.

Novig will voluntarily dismiss the Gaming Control Board defendants without prejudice. Those officials likewise agreed not to pursue Novig separately from the attorney general before the stay expires.

The parties stressed that the arrangement “does not resolve any claim or defense asserted in this action,” leaving their broader legal positions intact.

Novig’s New Mexico suit is part of a wider federal campaign launched after its approval as a CFTC Designated Contract Market. The company filed cases against New York, Massachusetts, New Mexico and Washington, arguing its sports event contracts are federally regulated derivatives rather than state-regulated sports wagers.

In Massachusetts, Attorney General Andrea Campbell has said “any company that wants to be in the sports gaming business in Massachusetts must play by our rules.” Novig argues federal law overrides those requirements.

The Massachusetts case is now paused too. U.S. District Judge F. Dennis Saylor IV granted a joint stay on Aug. 24 while KalshiEX LLC exhausts state appellate rights involving a preliminary injunction obtained by the Massachusetts Attorney General. The order also gave defendants 60 days after the stay to respond and dismissed several defendants without prejudice.

New York, meanwhile, opposed Novig’s emergency request, arguing that “Plaintiff’s failure to provide notice therefore amounts to an attempt to obtain an ex parte TRO … and should not be entertained by this Court.”

Featured image: Novig / Canva

The post Novig and New Mexico seek yearlong pause in prediction market lawsuit appeared first on ReadWrite.

The Alabama-Coushatta Tribe of Texas has opened Naskila Casino Leggett, giving Polk County its first operating piece of a much larger casino resort planned for the property.

Tribal members marked the occasion Monday (August 24) with a Tribal Membership Opening Day ceremony. Doors opened to everyone Tuesday and visitors began lining up early.

Operating around the clock, the temporary casino offers 300 electronic gaming machines and a dining facility. Local reporting says the operation has brought roughly 100 new jobs to the area.

For tribal leaders, Leggett also signals a new period of economic development after years spent fighting in court over gaming. In 2022, the U.S. Supreme Court ruled that Texas could not apply its gaming laws to stop electronic bingo on tribal land when state law did not prohibit the activity outright. Texas later abandoned its longstanding lawsuit against the Tribe.

Naskila Casino Leggett opening signals wider tribal gaming and economic expansion

Construction is already underway nearby on the permanent Naskila Casino Resort, which broke ground in June. Plans cover roughly 685,000 square feet, with about 3,400 electronic bingo machines and a 366-room hotel.

Guests are also expected to find restaurants, bars and lounges, a resort-style pool complex and around 35,000 square feet for conferences and events. A grand ballroom is designed for crowds of up to 1,000 people. The opening of the first phase is targeted for late 2028.

The development builds on Naskila’s existing operation near Livingston, which has been running since 2016. Tribal officials point to its wider role in the East Texas economy, including jobs and spending with regional businesses. An economic-impact study cited by the Tribe put that contribution at about $251.7 million annually.

Federal agencies had previously confirmed the Leggett property could host gaming. The land has been held in trust since 2001, and tribal membership approved the location in September 2025.

The federal status stands in contrast with another current tribal gaming dispute. In California, the Scotts Valley Band of Pomo Indians sued the Interior Department on August 7 after officials reversed their position on gaming eligibility for roughly 160 acres in Vallejo.

Interior had approved that property in January 2025 as “restored lands” under federal gaming law, using broader readings of “occupancy” and “vicinity”. After another review, the department reversed course July 30. Scotts Valley called that decision “arbitrary, capricious, contrary to law, unsupported by the administrative record” and said it was “compelled to suspend gaming operations” at its Class II facility. The tribe had pursued a temporary “preview casino” while the dispute continued.

In Leggett, meanwhile, the temporary casino is operating while construction moves ahead. The Alabama-Coushatta Tribe called its membership celebration “a new chapter” as it prepared to welcome the wider public.

Featured image: Alabama-Coushatta Tribe of Texas via Facebook

The post Alabama-Coushatta opens temporary Naskila Casino as permanent resort takes shape nearby appeared first on ReadWrite.

Nebraska voters will get a say on two online sports wagering proposals in the November 2026 general election. The Secretary of State’s office said August 21 that both petition campaigns gathered enough valid signatures to make the ballot.

“The Secretary of State’s office announced today that signature thresholds have been met for both the Online Sports Wagering Authorization Constitutional Amendment petition and the Online Sports Wagering Regulation Initiative petition to appear on the 2026 general election ballot,” the office said in a release.

For the constitutional amendment, organizers needed signatures from 10% of registered voters statewide, plus 5% of registered voters in at least 38 counties. Officials verified at least 138,473 signatures, with the county requirement met in at least 64 counties.

The statutory Online Sports Wagering Regulation Initiative needed signatures from 7% of registered voters statewide and the same 5% threshold in 38 counties. At least 96,918 signatures were verified, and organizers cleared the county requirement in at least 55 counties.

Online sports betting debate now moves to Nebraska voters

County election officials were not required to keep reviewing every submitted signature after the campaigns had safely exceeded the minimum.

“The Elections Division instructed county election offices to conclude signature verification after the number of valid signatures met the 110% threshold as permitted in Neb. Rev. Stat. § 32-1409,” the Secretary of State’s office said about each petition.

Under Nebraska law, county officials compare petition information with voter registration records and confirm that signers were properly registered. The state can stop that process once county reports show “signatures in excess of one hundred ten percent of the number necessary to place the issue on the ballot have been verified,” allowing remaining checks to end.

Once those county reviews are complete, the Secretary of State determines whether a petition satisfies state requirements. The statute says, “If the petition is found to be valid and sufficient, the Secretary of State shall proceed to place the measure on the general election ballot.”

The ballot push follows earlier debate in the Legislature over expanding sports betting. In March 2025, lawmakers considered several proposals, including Sen. Elliott Bostar’s LR20CA, which sought a constitutional amendment allowing licensed racetracks to partner with online sportsbooks. Supporters argued Nebraska was losing potential tax revenue to illegal betting and neighboring states where online wagering is legal.

Opponents focused on addiction and financial harm. “If they want to bet on sports, they can, but this is trying to force it onto every device in the state,” said Nate Grasz of the Nebraska Family Alliance, as reported by SBC Americas.

“Anybody who wants to find online gambling can already find it,” added Mike Sciandra of the Nebraska Gamblers Assistance Program.

Public hearings on the certified measures will now be held in all three congressional districts, with dates and locations coming later. The state will also prepare an informational brochure.

Officials are still reviewing two other petition campaigns. The ballot must be certified by September 11. “All petitions will be processed and announced by that date,” the office said.

Featured image: Canva

The post Nebraska online sports betting measures qualify for November 2026 ballot vote appeared first on ReadWrite.

Kalshi is widening its footprint in Major League Baseball (MLB) after agreeing to exclusive, multi-year brand partnerships with five clubs. The prediction market platform announced the deals on Tuesday (August 25).

The Atlanta Braves, Boston Red Sox, Los Angeles Dodgers, San Diego Padres and San Francisco Giants are all part of the agreements. Kalshi will serve as a prediction market partner for each team, with its brand appearing in stadiums and across social media, digital promotions and radio. Fans will also see activities and offers tied directly to the platform.

The expansion comes as baseball trading has surged on Kalshi. The company says trading volume connected with the sport is now 36 times higher than it was one year earlier.

Kalshi and MLB push comes as prediction markets gain wider acceptance

At Dodger Stadium, the partnership will give Kalshi a particularly visible presence. LED signs carrying its branding will be displayed around the ballpark, while the company is also getting naming rights for the stadium’s Gold Glove Bar.

Dodgers fans can expect Kalshi-specific offers as well. During the season, the agreement will bring exclusive fan activities to Centerfield Plaza.

“The idea is that fans are already engaging with their favorite teams on Kalshi, so it only makes sense to extend that fandom to some of the most beloved baseball teams in America,” said Adam Barrick, Head of Sports Partnerships at Kalshi.

The agreements arrive during a shift in MLB’s relationship with prediction markets. In July, the New York Mets announced a multi-year partnership with Novig that the companies described as the first deal between an MLB franchise and a prediction market company.

At league level, MLB has already chosen Polymarket as its exclusive prediction market exchange partner. MLB and the US Commodity Futures Trading Commission also signed a memorandum of understanding in March covering information sharing, market monitoring and efforts to spot fraud or manipulation involving baseball event contracts.

The growing commercial involvement comes with restrictions for people inside the sport. During the 2025 season, MLB circulated guidance telling major and minor league players not to participate in baseball-related prediction market contracts, including products offered by Kalshi and Polymarket. The league treated that activity as prohibited under its long-standing betting rules.

Kalshi, founded in 2018, runs an exchange where customers trade contracts based on event outcomes. The company presents prediction markets as a way of showing changing expectations about future events in real time.

Featured image: Kalshi via press release

The post Kalshi signs five MLB team deals as prediction markets expand further appeared first on ReadWrite.

Former New Jersey Gov. Chris Christie has predicted that the escalating battle over prediction markets will ultimately reach the U.S. Supreme Court, as states, federal regulators and the fast-growing industry clash over whether sports event contracts should be treated as federally regulated derivatives or gambling subject to state law.

Christie, now a strategic adviser to the American Gaming Association, made the comments during an appearance on CNBC’s Squawk Box, where he criticized the regulatory framework surrounding prediction markets and argued that the products are encroaching on states’ longstanding authority over sports wagering.

“What I know is the policy is wrong. It’s injurious to the states,” Christie said. “You’ve got 1.3 billion in tax revenue to states that have already been siphoned off by the predictive market companies, and they refuse to allow themselves to be regulated.”

Christie also raised concerns about the accessibility of sports-related prediction contracts to younger customers, contrasting the rules with those governing traditional sportsbooks.

“They’re marketing to college students,” Christie said. “They’re marketing to 18-year-olds, 19-year-olds who, in the sports gaming business, are not allowed to bet, they are allowed to bet on the predictive market.”

Asked what would happen if the state-regulation side of the dispute ultimately loses in court, Christie said he sees two possible paths: congressional intervention or a Supreme Court ruling.

“I think it’s going to go to the Supreme Court,” Christie said. He suggested that legislation such as the CLARITY Act could potentially settle the jurisdictional question by establishing that the Commodity Futures Trading Commission does not regulate sports gaming.

Otherwise, Christie argued, the courts will have to decide.

“The Supreme Court, I think, has been pretty clear on this—and it was our case that brought this out—that this is a state issue, and that the states are regulating effectively and there’s no reason for the federal government to come in,” he said.

CFTC and prediction market companies push back

The CFTC takes the opposite position. In February, the regulator said in a Ninth Circuit filing that it has “exclusive jurisdiction” over U.S. commodity derivatives markets, including event contracts commonly known as prediction markets. CFTC Chairman Michael Selig said efforts by states to regulate those markets disregard federal law and precedent.

It has put Christie directly at odds with Selig.

In the same month, Christie argued that federal intervention infringes on both states that permit sports betting and those that prohibit it.

“Violating the rights of states who have been regulating sports betting and the rights of the states who oppose sports betting is not the purview of another alphabet soup federal agency,” Christie wrote on X. “Yes I am standing up for the rights of all 50 states. Proud of it.”

Selig responded by accusing Christie of pursuing a national campaign against the industry, writing: “Chris Christie is leading a campaign to ban American Prediction Markets in states across the country. We’re simply not going to allow that to happen.”

The CFTC has since continued to defend federal preemption. In April, the commission intervened in litigation in Massachusetts and said Congress had given it sole authority over commodity derivatives markets, including prediction markets. By May, the agency was also seeking to block Rhode Island from applying state gambling laws to CFTC-registered contract markets, adding to disputes involving Arizona, Connecticut, Illinois, Minnesota, New York and other states.

Chris Christie disputes claims about enforcement and court losses as prediction markets face lawsuits

The argument intensified again after Christie publicly questioned the CFTC’s ability to police the markets.

Robert DeNault, Kalshi’s head of enforcement, responded by accusing Christie of getting two important points wrong.

“Good policy and legal debates turn on facts, not fiction. But Governor Christie’s claims aren’t based on facts,” DeNault wrote in the post provided.

On Christie’s assertion that the CFTC lacks investigators, DeNault said: “The CFTC and the exchanges it regulates have entire teams of investigators — we talk all the time.”

There is evidence of significant exchange-level enforcement activity. Kalshi told NPR that it launched more than 150 insider-trading investigations, blocked more than 100 attempted insider trades and referred at least 20 cases to law enforcement during the first quarter of 2026. DeNault has also described Kalshi’s surveillance and investigative systems, while acknowledging that “no system is perfect.”

DeNault also challenged Christie’s characterization of the industry’s court record. According to DeNault, Christie claimed prediction markets had lost “85%” of their cases.

“The legal split is much closer to 50-50,” DeNault wrote, citing the Third Circuit and courts in New Jersey, Minnesota, Tennessee and Arizona on one side of the developing legal divide, and courts in New York, Massachusetts, Nevada, Wisconsin, Utah, Michigan and Connecticut on the other.

The competing claims underscore how unsettled the law remains, with litigation developing across multiple jurisdictions rather than producing a single nationwide answer.

Utah joins the states’ rights challenge

Christie has found a prominent ally in Utah Gov. Spencer Cox, who has similarly rejected the idea that sports event contracts should escape state gambling regulation simply because they are offered through federally regulated exchanges.

In February, Cox mocked the CFTC’s derivatives argument, saying he did not remember the commission having authority over the “derivative market” for “LeBron James rebounds.”

Cox was unequivocal about how he views the products: “These prediction markets you are breathlessly defending are gambling—pure and simple.” He added that they “have no place in Utah” and pledged to use the resources available to him as governor to fight the federal position in court.

The fundamental question is one now being litigated around the country: whether event contracts offered by federally regulated exchanges are derivatives governed by federal commodities law or, particularly when based on sporting events, function as sports wagers that must comply with state licensing, consumer-protection and age requirements.

Trump throws White House support behind prediction markets

President Donald Trump has firmly backed the federal-regulation side of the argument.

In May, Trump declared that “it is critically important that the CFTC’s exclusive authority over Prediction Markets is maintained, and that they will thrive.” He described prediction markets as a “new form of Financial Market” and praised Selig’s leadership of the CFTC.

Trump also singled out Christie and other state-level opponents of the federal approach, writing: “We cannot have SCUM like Chris Christie, Letitia James, Tim Walz, and JB Pritzker setting the rules!”

That places Christie, a former Republican presidential candidate, on the opposite side of the regulatory dispute from the Trump administration despite the participation of Republican officials such as Cox in the state-led pushback.

His argument remains that sports wagering is a matter for the states—and that if Congress does not settle the issue first, the Supreme Court eventually will.

Featured image: Gage Skidmore via Flickr / CC BY-SA 2.0

The post Chris Christie says prediction market fight is headed for Supreme Court as states challenge CFTC appeared first on ReadWrite.

Independent senator David Pocock has accused the Albanese government of undermining its own pledge to break the connection between gambling and sport, after it emerged betting company logos could remain on professional sporting jerseys until the end of 2031.

Children across Australia could continue seeing gambling brands on the jerseys of their sporting heroes for more than five years under transitional provisions in the federal government’s gambling reforms.

The legislation bans wagering company logos on professional sports jerseys, but existing sponsorship arrangements can continue during a five-year transition period, potentially keeping the branding in place until December 31, 2031.

The delay has drawn a sharp response from ACT independent senator David Pocock, who has been campaigning for a comprehensive ban on gambling advertising and has called on sporting clubs to voluntarily abandon betting sponsorships sooner.

“We are in an absurd situation where by the time of the legislation’s three-year statutory review, jerseys may still have betting logos on them,” Pocock said, according to The Guardian.

Pocock also called on clubs to end their existing jersey sponsorship arrangements “at the earliest opportunity.”

Responding on social media, Pocock said the extended transition was incompatible with the government’s stated ambition of separating gambling from Australian sport.

“The Govt has talked a lot about breaking the nexus between gambling and sport but allowing betting company logos on team jerseys until potentially as late as 2035 won’t do that,” Pocock wrote.

“We are in an absurd situation where by the time of the legislation’s three-year statutory review, players may still be wearing these logos.”

The government says the transition period is intended to balance its reforms with existing commercial agreements. Communications minister Anika Wells said one unnamed sporting club has a jersey sponsorship deal extending until 2031.

“In trying to strike a balance here between grandfathering existing arrangements and ensuring viability, that’s what we got to,” Wells said.

Wells said she hoped sporting organizations would end wagering sponsorships earlier where possible, but argued those decisions ultimately rested with the clubs.

The controversy follows the government’s package of gambling advertising reforms, which includes a new national “Wagering Advertising Opt-out Register.” The register is intended to give Australians a single mechanism to opt out of wagering advertising from online content providers and will be administered by the Australian Communications and Media Authority.

However, the reforms stop short of the comprehensive advertising ban recommended by the late Labor MP Peta Murphy’s landmark parliamentary inquiry.

Pocock has argued that the legislation will “not break the connection between sport and gambling” and will fail to sufficiently reduce children’s exposure to wagering advertising.

The criticism predates the latest dispute over jersey sponsorships.

Earlier this month, Pocock tabled a petition signed by more than 700 Canberrans calling for a full ban on gambling advertising. More than 16,000 emails had also been sent to federal parliamentarians through his Stop Gambling Ads campaign.

“The major political parties are showing just how captured they are by vested interests. They are listening to donors and lobbyists rather than experts and communities,” Pocock said at the time.

He said the legislation represented a “weak, watered down bill” that would not adequately protect children from what he described as an “extraordinarily predatory industry”.

The senator has also linked the gambling debate to broader concerns about lobbying and the influence of industry over federal policymaking. In a separate social media post promoting an ABC Four Corners investigation, Pocock said recent events had demonstrated “the power of vested interests over public policy” and called for tougher lobbying laws and restrictions on the “revolving door” between government and industry.

Pocock condemns gambling jerseys amid reform backlash

The Alliance for Gambling Reform has similarly attacked the final package, saying the agreement between Labor and the Coalition amounted to “weak” and “timid” reform.

Alliance chief advocate Tim Costello said the major parties had missed a rare opportunity to substantially strengthen protections against gambling harm.

“The reforms that will now go through the Federal Parliament are cosmetic over substance and reflect the major party’s intent to prioritise power, money and vested interests over the welfare of Australians,” Costello said.

The Alliance argues the legislation falls far short of the Murphy inquiry recommendations, which included a comprehensive gambling advertising ban, stronger restrictions on inducements, a national gambling regulator and treating gambling harm as a public health issue.

It also criticized the government’s reliance on an opt-out model.

“An opt-out register will not be effective in preventing harm, and it is not what Australians are calling for,” Costello said.

Alliance chief executive Martin Thomas warned that children were increasingly being reached through sophisticated digital marketing as well as traditional sports broadcasts.

“The evidence shows that underage kids as young as 14 are being targeted through social media to download gambling apps,” Thomas said, adding that children were also being exposed to what he described as a “tsunami of gambling ads” through television and sport.

The organization said the government’s measures “will not protect children, will not delink sport and wagering and will not end the saturation of media ads” Australians encounter.

The jersey provisions have become a particularly visible test of that promise.

According to The Guardian, seven NRL clubs currently have wagering or lottery branding on their jerseys, with several agreements running until at least the end of the 2028 season. The Sydney Roosters extended their longstanding UniBet jersey sponsorship in July 2025, with the branding also appearing on the club’s women’s jerseys.

Public health expert Samantha Thomas said the lengthy transition made it “difficult to take the government seriously” when it claimed it wanted to break the nexus between gambling and sport.

“The government has effectively said that they recognise that gambling sponsorship is harmful to children and then decided that it can continue for the next five years,” she said.

Martin Thomas said the grandfathering provisions “underscored how little a difference these compromised gambling reforms will make.”

Liberal MP Andrew Wallace, who crossed the floor to oppose the legislation, has also criticized the five-year transition, arguing that two years would have provided sporting organizations sufficient time to secure replacement sponsors.

For Pocock, a child in Year 8 today could potentially reach the end of secondary school while still watching professional athletes take the field wearing gambling company branding.

Featured image: Nat Butcher via WikiCommons / CC BY 2.0

The post Pocock condemns ‘absurd’ delay that could leave gambling logos on sports jerseys until 2032 appeared first on ReadWrite.

Kalshi is pushing to keep New York’s lawsuit against the prediction-market operator in federal court, saying the state’s case cannot be resolved without answering key questions about federal commodities and gambling law.

In an August 21 filing in the U.S. District Court for the Southern District of New York, Kalshi challenged Attorney General Letitia James’ effort to send the dispute back to state court.

“This case should not be remanded,” Kalshi said in the filing.

New York sued Kalshi on July 31, accusing the company of operating an illegal gambling business without a state gaming license. The case cites the federal Wire Act alongside New York constitutional, criminal, racing and wagering laws. Officials want to stop Kalshi’s operations in the state and are seeking restitution, disgorgement, civil penalties and accounting information.

Kalshi moved the lawsuit into federal court that same day.

The Commodity Futures Trading Commission (CFTC) granted Kalshi designated contract market status in 2020. Kalshi maintains that its contracts are federally regulated derivatives and fall under the CFTC’s exclusive jurisdiction when traded on its market.

Kalshi says federal commodities law overrides New York gambling claims

Sports contracts joined Kalshi’s offerings in January 2025. When those products were self-certified, the CFTC asked Kalshi for information showing they complied with federal law, according to the filing. Kalshi responded, and the regulator took no further action.

“The State’s claims necessarily raise disputed and substantial federal law issues,” Kalshi said.

Kalshi points to three reasons the federal court should retain the case. Its first argument focuses partly on New York’s Wire Act claim. Deciding it, Kalshi says, means determining whether event contracts qualify as betting or wagering and examining the Wire Act alongside the Unlawful Internet Gambling Enforcement Act and Commodity Exchange Act.

The company says the same federal questions underpin New York’s state gambling allegations because a court must decide whether federal law permits the contracts as swaps regulated by the CFTC.

Kalshi also invokes the federal officer removal statute and argues that its CFTC designation gives it a federally derived property right. Separately, it says New York cannot sidestep federal jurisdiction by excluding the CFTC as a party.

The jurisdiction battle follows regulatory clashes. On August 11, the CFTC issued an emergency order directing Kalshi to continue normal operations while the litigation proceeds, after warning that New York’s requested restrictions could disrupt derivatives markets. New York has also pursued a separate Gaming Commission investigation and previously ordered Kalshi to cease operations.

“The federal issue—whether Kalshi’s event contracts are unlawful gambling or authorized swap transactions traded on a federal exchange subject to the CFTC’s exclusive jurisdiction—is ‘actually disputed,’” the company said.

Kalshi now wants the federal judge to reject New York’s remand request and keep the dispute in federal court.

Featured image: Canva / Kalshi

The post Kalshi fights New York bid to move prediction market case to state court from federal court appeared first on ReadWrite.

The Commodity Futures Trading Commission (CFTC) is backing the criminal case against Gannon Ken Van Dyke, a US Army master sergeant accused of using classified military information to make more than $400,000 trading Polymarket event contracts tied to Venezuela and Nicolás Maduro.

In an August 21 notice, the CFTC asked the US District Judge Margaret M. Garnett for permission to file an amicus brief supporting prosecutors as Van Dyke seeks to dismiss Commodity Exchange Act charges. He argues the contracts are not swaps under federal law and says applying its anti-fraud provision to his conduct would be unconstitutional.

“Both contentions are wrong,” CFTC Counselor Cameron Sinsheimer wrote in the letter.

The regulator argues Congress defined swaps broadly enough to include the event contracts Van Dyke traded. It says adopting his interpretation could also significantly restrict federal oversight of prediction markets.

“Van Dyke’s distortion of the CEA’s text, if accepted, would undermine the Commission’s jurisdiction over a huge range of event contracts whose notional volume totals into the tens of billions of dollars,” Sinsheimer wrote.

CFTC says Polymarket event contracts fall under federal swaps law in US soldier case

Van Dyke, 38, served with US Army Special Operations Command at Fort Bragg, North Carolina. Prosecutors say his role in Operation Absolute Resolve gave him access to classified and other nonpublic details about a mission targeting Maduro.

“The core theory of the Indictment is that Van Dyke took information that he had pledged to keep confidential and, though he was duty-bound not to do so, he used it to make a personal profit,” prosecutors said.

Van Dyke had signed nondisclosure agreements covering classified material. One agreement concerning “Western Hemisphere Operations” said information obtained through his work “is now and will remain the property of the United States Government.”

According to prosecutors, he opened a Polymarket account on December 26, 2025, before spending about $33,934 on contracts involving Venezuela and Maduro through January 2. US special forces captured Maduro and his wife in Caracas on January 3. Prosecutors say the successful trades left Van Dyke with more than $400,000 in net profit.

A grand jury indicted him in April on five counts covering confidential government information, commodities and swap fraud, wire fraud and an unlawful monetary transaction. He pleaded not guilty and was released on $250,000 bail with travel restrictions.

Prosecutors have called it the Justice Department’s first criminal insider-trading prosecution involving prediction markets. Van Dyke moved to dismiss the indictment on July 31.

Van Dyke “committed an old crime on a new platform,” they said.

“Because the Indictment alleges all that it must,” prosecutors said, “the next step is trial.”

The CFTC also rejects Van Dyke’s argument that he lacked sufficient notice that federal law covered his alleged conduct. It points to the Commodity Exchange Act, its own regulatory actions and similar contracts traded on CFTC-registered exchanges.

The agency says its proposed filing could help the court address legal questions with implications beyond Van Dyke’s prosecution.

“Here, the proposed amicus brief is both timely and useful, and will aid the court in its deliberation of this matter by offering insights not available from the parties,” Sinsheimer wrote.

Featured image: CFTC via Wikimedia Commons / Canva

The post CFTC backs case against US soldier accused of Polymarket insider trading appeared first on ReadWrite.

More than 150 cryptocurrency wallets betting on military events through Polymarket behaved in ways researchers associate with possible insider trading. Now a separate federal prosecution involving a U.S. Army master sergeant is giving those concerns a real-world legal test.

The Anti-Corruption Data Collective, or ACDC, identified 152 wallets making unusually successful longshot bets in military and defence markets. Together, the wallets won about $8 million.

Its August report, Classifying Insider Trading Risk: Analyzing the Longshot Betting Ecosystem on Polymarket, examined 78,496 longshot bets from 12,355 wallets on markets settled through May 5, 2026.

The research does not show that those 152 wallets belonged to military personnel, government officials or anyone else holding classified information. Instead, ACDC created a statistical profile for accounts whose behaviour resembles previously reported cases of suspected insider trading.

Researchers call those accounts “Orcas.” They tend to focus on relatively few subjects, win unusually often when betting on outcomes the market considers unlikely and sometimes appear shortly before the event being predicted.

ACDC put wallets with longshot success rates above 75%, concentrated activity and limited market breadth among its most suspicious accounts.

Suspicious military bets appeared on Polymarket before larger traders moved in

Of 1,432 wallets making longshot military bets, researchers classified 152 as Orcas. Another 482 were high-volume “Whales,” while 166 appeared to be automated Bots.

The Orcas put roughly $2 million into military longshots and made an average profit of about $52,514 per wallet. ACDC cautioned that proving whether any individual trader actually possessed inside information would require investigative powers beyond the study.

What happened after those bets appeared may be just as important. Around major military events, winning Orca wagers generally arrived before Whales and Bots moved into the same markets.

“In both cases, longshot bets by Orcas preceded longshot bets by Whales and Bots,” the researchers found in their analysis of military-market activity.

It raises the possibility that sophisticated traders were watching public blockchain transactions, spotting unusual bets and following them with larger positions. One informed wager could therefore become a signal that other market participants quickly amplify.

“If financial speculators can quickly observe insider bets and act on them in real time, then so can militaries and intelligence agencies around the world,” the report says.

ACDC examined activity surrounding Iran-related strikes in June 2025 and February 2026. During the June episode, an Orca made the first correct longshot wager more than a week before the strikes. Another bet about 13 hours before the attack was followed roughly 20 minutes later by a much larger Bot wager.

In February, Orcas again appeared before Whales and Bots. Researchers saw a “flurry” of Orca activity around February 16, followed by increased Whale positions and more automated betting as the strikes approached.

The pattern is consistent with other traders reacting to wallets they believed had better information, although it does not prove that explanation.

Across the full dataset, ACDC classified 556 of the 12,355 longshot wallets as Orcas. The markets represented around $15.6 billion in betting volume and $197 million in net profits.

Orcas averaged returns of 132% across all markets. Among those active in military markets, the report put average returns at about 167%, compared with roughly 1% for Whales and Bots and losses for ordinary traders labelled “Small Fish.”

US soldier allegedly made $400,000 betting on classified operation

The statistical warnings now sit alongside a separate criminal case in Manhattan involving Army Master Sgt. Gannon Ken Van Dyke, 38, who served with U.S. Army Special Operations Command at Fort Bragg, North Carolina.

Federal prosecutors allege Van Dyke used classified and other nonpublic information he obtained through his work on Operation Absolute Resolve to make Polymarket bets involving U.S. military action in Venezuela and Nicolas Maduro’s removal from power.

“The core theory of the Indictment is that Van Dyke took information that he had pledged to keep confidential and, though he was duty-bound not to do so, he used it to make a personal profit,” prosecutors said.

According to prosecutors, Van Dyke opened his Polymarket account on December 26, 2025. Between December 27 and January 2, he allegedly spent about $33,934 buying “YES” shares connected to Venezuela and Maduro while working on the operation.

One position involved roughly 13,769 shares predicting Maduro would be out of power by January 31, 2026. Van Dyke allegedly paid about nine cents a share, a market price implying roughly a 9% probability.

U.S. special forces captured Maduro and his wife in Caracas before dawn on January 3. Once the operation became public, several contracts settled at $1 per “YES” share. Prosecutors allege Van Dyke made more than $400,000 in net profit.

A federal grand jury indicted him in April on five counts involving confidential government information, commodities and swap fraud, wire fraud and an unlawful monetary transaction. Van Dyke pleaded not guilty and was released on $250,000 bail subject to travel restrictions.

The Justice Department has described it as its first criminal insider-trading prosecution involving prediction markets. The Commodity Futures Trading Commission also filed a parallel civil case in April.

Van Dyke asked the court on July 31 to dismiss the criminal indictment. Among his arguments, he contended that the event contracts were not swaps under the Commodity Exchange Act and that classified military information could not constitute property for wire-fraud purposes.

Prosecutors pushed back in an August 19 filing in the Southern District of New York, arguing that all five counts should proceed and that Van Dyke’s arguments should be decided at trial.

They say the statutory definition of swaps can cover event contracts with financial, economic or commercial consequences. They also cite Van Dyke’s nondisclosure obligations, including an agreement concerning “Western Hemisphere Operations” in which he acknowledged information obtained through his work “is now and will remain the property of the United States Government.”

Van Dyke “committed an old crime on a new platform,” they said.

“Because the Indictment alleges all that it must,” prosecutors said, “the next step is trial.”

Public Polymarket trades could expose military secrets

The Van Dyke allegations remain unproven, and the ACDC analysis separately stops well short of claiming that its 152 military-market Orcas possessed classified information. Together, though, the cases illustrate two sides of the same problem: identifying who may have traded on secret information and understanding what their public trades reveal to everybody else.

Blockchain transparency helped ACDC follow funds through cryptocurrency exchanges, bridges, decentralised exchanges and other services. But public addresses do not necessarily disclose their owners, and trails can end at institutions handling assets for thousands of customers.

That makes suspicious behavior easier to spot than the person responsible for it.

The larger security concern can emerge before investigators ever identify a trader. Prediction markets covering wars, military operations and government decisions give people with confidential knowledge a financial incentive to act. Their wagers can then be monitored by algorithms, wealthy investors and potentially foreign intelligence services.

ACDC recommends stronger bettor identification, conditional payouts for suspicious high-risk bets and restrictions on particularly vulnerable market categories. It ultimately argues that some markets present risks those measures cannot eliminate.

“Only outright bans on the highest-risk market segments can adequately address the risks and the structural imbalance they sustain,” the report concludes.

Whether any of ACDC’s 152 military-market wallets were controlled by people holding classified information remains unanswered. The Van Dyke prosecution could meanwhile test how existing fraud and commodities laws apply when prosecutors allege that government secrets were converted into prediction-market profits.

The underlying vulnerability is broader than either case. Once secret knowledge becomes a publicly visible wager, other traders can see it, copy it and magnify it long before investigators determine who placed the original bet.

Featured image: AI-generated image via Canva / Polymarket

The post Polymarket military bets expose security risks as soldier case reaches court appeared first on ReadWrite.

Ontario’s gambling watchdog has hit Booming Games with a CAD $70,000 ($51,000) penalty after discovering that players could use a banned auto-play feature on several online slot titles.

The Alcohol and Gaming Commission of Ontario found the functionality had been available for months through the platform of a licensed operator. Provincial standards do not allow auto-play on slot games while customers are betting money.

According to the AGCO, problems with how Booming Games configured, checked and monitored some of its titles allowed the feature to remain active both when the games launched and afterward.

Once investigators spotted the problem, the commission alerted the operator and auto-play was switched off. The AGCO has not named the operator.

Booming Games has held registration as an Ontario gaming supplier since early 2024 and provides online casino titles to operators in the province. It has 15 days to challenge the $70,000 monetary penalty before Ontario’s Licence Appeal Tribunal.

Ontario enforcement puts suppliers such as Booming Games under growing compliance pressure

With auto-play enabled, a slot can automatically run several rounds instead of making the customer manually trigger every spin. Ontario bans that setup for real-money wagering as part of its player-protection rules.

The regulator argues that manually starting each round introduces a break in play, leaving customers with a moment to decide whether to place another wager.

“Requiring players to manually start each spin creates a deliberate pause between wagers,” the regulator said. “This pause can help maintain player awareness and control, reduce prolonged and uninterrupted play, and reduce the risk of gambling-related harm.”

Those restrictions are designed to curb rapid, intense and uninterrupted gambling while supporting more deliberate decisions. Auto-play can still be offered during bonus rounds when no additional money is being wagered.

The commission identified two breaches of its internet gaming standards. One covered the availability of prohibited auto-play, while the second involved shortcomings in testing and monitoring that left gaming systems or supplies without evidence they were operating as approved.

The action comes amid wider enforcement by the AGCO. Earlier in August, Betty Gaming Ltd. received a CAD $120,000 penalty after weaknesses in its age-verification and eligibility controls allowed underage people to access Betty.ca. Nine people under 19 opened accounts, deposited and gambled, while another 14 created accounts without depositing.

Other recent cases have included a CAD $54,000 penalty against Well Played Media over a promotion the regulator said encouraged high-risk gambling and did not clearly disclose important terms. The AGCO has also targeted unapproved Prime Slot machines, conducting more than 200 inspections and removing over 50 machines from locations including bars, restaurants and lottery retailers.

For Booming Games, the latest order reinforces the commission’s position that suppliers share responsibility with operators for keeping products compliant when they enter Ontario’s regulated market and as they continue operating.

Featured image: AGCO / Booming Games

The post Ontario fines Booming Games $70,000 over prohibited slot auto-play feature access appeared first on ReadWrite.

Caesars Sportsbook has been ordered to pay more than $296,000 after New Jersey regulators found the company broke several rules designed to support responsible gambling.

The New Jersey Division of Gaming Enforcement assessed a $251,250 civil fine and told Caesars to give up another $45,465.38, according to an order from the state Attorney General’s Office and Department of Law and Public Safety. The two payments add up to $296,715.38.

Caesars agreed to the $251,250 penalty. The sportsbook will be required to pay the full amount after receiving an invoice from the Division of Gaming Enforcement.

Regulators first took action against Caesars on August 5, 2026. The latest order makes that enforcement action final and says the sportsbook failed to comply with several New Jersey regulations covering responsible gaming.

However, the document does not explain what Caesars did to violate those requirements. It gives no details about affected customers or individual transactions and does not say when the conduct happened.

There is also no explanation for how officials reached the two financial amounts. The order does not show how much of the $251,250 fine relates to each violation, while the calculation behind the $45,465.38 disgorgement is also left unspecified.

Caesars faces mounting regulatory penalties across multiple states

The New Jersey case follows other regulatory action involving Caesars in major US gambling markets.

In Nevada, Caesars Entertainment agreed in November 2025 to a proposed $7.8 million fine stemming from compliance failures linked to convicted illegal bookmaker Mathew Bowyer. Nevada regulators alleged unsuitable operating practices connected with Bowyer’s activity at Caesars Palace.

As part of that proposed settlement, Caesars faced additional conditions on its gaming approvals. The company had also introduced remedial measures, with much of that work involving improvements to its anti-money laundering program as well as additional employee training and awareness.

Bowyer operated an illegal bookmaking business and handled more than $325 million in wagers from Ippei Mizuhara, the former interpreter for baseball star Shohei Ohtani. He also admitted laundering money and failing to report $4 million in income to the IRS.

Massachusetts regulators separately fined Caesars Sportsbook $10,000 in March 2026 for offering a prohibited betting market during UEFA Euro 2024. The sportsbook allowed customers to wager on the total number of red cards issued during the tournament.

Six bets from three customers were placed on that market, representing $8,270 in total stakes. Caesars was one of five sportsbooks penalized by Massachusetts regulators at the time, with fines across the operators totaling $80,500.

Featured image: Caesars Entertainment via website

The post New Jersey regulators fine Caesars Sportsbook almost $300K over responsible gaming rule violations appeared first on ReadWrite.

At the CFTC inaugural Innovation Advisory Committee meeting, Wall Street veterans and upstarts from prediction markets agreed Washington needs clearer rules. They were rather less united on whether some of the products currently being invented should exist at all.

The Commodity Futures Trading Commission (CFTC) convened some of the biggest names in crypto, derivatives and prediction markets on Thursday to discuss the future of American finance. For roughly three hours, the future was blockchain, artificial intelligence, federal pre-emption and regulatory clarity.

Then Terry Duffy got the microphone.

The chairman and chief executive of CME Group had listened through discussions of crypto, tokenization and AI before arriving at prediction markets — the final 50-minute session on the CFTC’s official agenda, which specifically called for debate over jurisdiction, manipulation, product design and consumer protection.

“I’m a little concerned about this and I’m a lot concerned about it,” Duffy said.

His complaint was that innovation is all very exciting until somebody discovers that the easiest way to predict an event is to cause it.

Duffy said roughly 2,500 contracts had been self-certified since January 2025 without one being opposed, and argued that some products were plainly susceptible to manipulation. He cited sports contracts, a market involving Venezuelan leader Nicolas Maduro and a market tied to what President Donald Trump might say — the latter becoming controversial after Duffy said a teleprompter operator had been involved.

“That is not good for our industry,” Duffy said. “That is horrible for our industry. We’re not a bunch of carnival barkers at a circus.”

CFTC Chairman Michael Selig promptly objected to the examples. The Maduro and teleprompter contracts, he said, had not been listed in the United States.

“They never were,” Selig said. “This occurred offshore and that’s fake news.”

“Fake news,” Duffy replied. “Okay, that’s a cute comment, too.”

And with that, the Innovation Advisory Committee had achieved innovation in perhaps its purest form: a federal financial-regulation meeting people might voluntarily watch.

Duffy conceded the two contracts had traded offshore, while continuing to argue that their manipulability illustrated the broader danger. Then, lest anyone think the discussion had become insufficiently surreal, he introduced another matter of national economic significance.

“There’s another really economic contract that has been massively important for the United States,” Duffy said. “That’s a Nathan’s hot dog eating contest.”

Welcome to the new frontier of finance.

CFTC innovation push puts Congress on notice

The meeting was the inaugural gathering of the CFTC’s Innovation Advisory Committee, held Thursday (August 20) in Washington. The official agenda allotted 50 minutes to crypto regulation, 35 minutes to artificial intelligence and 50 minutes to prediction markets.

The committee itself is unusually heavy on people whose companies have a direct commercial interest in how those rules are written: Coinbase’s Brian Armstrong, CME’s Duffy, Robinhood’s Vlad Tenev, Polymarket’s Shayne Coplan, Kalshi’s Tarek Mansour, Gemini’s Tyler Winklevoss, DraftKings’ Jason Robins, FanDuel’s Christian Genetski and executives from Nasdaq, Cboe, Kraken, Ripple and other financial and crypto businesses.

Selig did not exactly open proceedings with the traditional regulatory message of we will carefully consider all relevant factors.

Instead, he declared that America had “crossed the Rubicon” into a new financial era. Blockchain, AI and prediction markets would transform finance, he said; the only questions were where that transformation would happen and “who will write the rules.”

On crypto, Selig made the choice unusually explicit.

He urged Congress to pass the CLARITY market-structure legislation, describing it as the best protection against another regulator conducting what he called a “rogue campaign of lawfare.” But if the bill stalls, he said, the CFTC will not sit around waiting for Capitol Hill.

“If CLARITY continues to stall because of Democratic obstruction, the CFTC will utilize its existing authorities to begin establishing a regime for crypto asset markets,” Selig said.

He said staff had already been directed to explore rules that could create a CFTC-regulated category of crypto-asset market and to work with onchain developers on compliant ways to operate in the United States.

In other words Congress may write the rules. The CFTC is preparing a pen just in case.

This was enthusiastically received by Armstrong, who described the previous regulatory environment as “a disgrace for America.” He recounted meetings in which Coinbase sought guidance from regulators, was told officials would not provide legal advice, and then found enforcement personnel taking notes. Coinbase would later receive a Wells notice, he said.

Armstrong joked that “nobody has done more for the economic development of the UAE and the Bahamas than Gary Gensler,” arguing that regulatory uncertainty pushed roughly 80% of crypto trading offshore.

The atmosphere, in other words, was not especially nostalgic for the previous SEC chairman.

Prediction markets meet their oldest problem: humans

If crypto produced the meeting’s broadest political message, prediction markets produced its sharpest philosophical argument.

Selig’s position is that federally regulated event contracts belong principally under the CFTC. In his prepared remarks, he accused states seeking to apply gambling laws to federally regulated derivatives exchanges of suffering from “Name Fixation Syndrome” — the mistaken idea that because something is called a sports future, sports regulators must regulate it.

The CFTC, he assured attendees, is “not afflicted with NFS.”

Brian Armstrong was happy to write the agency a clean bill of jurisdictional health.

“The federal law is unambiguous here,” he said. “The CFTC has exclusive jurisdiction.”

Armstrong went considerably further, arguing that prediction markets provide a public good by helping people determine “what’s true in the world” and are becoming an alternative to traditional and social media, whose information can reflect the biases of whoever is doing the talking.

There is, however, an awkward engineering problem with markets designed to predict reality: occasionally a trader can reach over and give reality a shove.

Robinhood CEO Vlad Tenev singled out “mention markets,” where traders wager on whether somebody will utter a particular word or phrase. They are “very fun,” Tenev conceded, but certain versions are “very prone to manipulation.” He described people at public appearances yelling at speakers to say particular words — leaving open the possibility that the enthusiastic audience member requesting a phrase may not merely be a devoted student of rhetoric.

Tenev’s verdict was characteristically Silicon Valley: the product is entertaining, possibly manipulable and therefore something “to look at a little bit more carefully.”

Then the generational argument began

Duffy’s criticism quickly turned into the meeting’s most memorable exchange when Luana Lopes Lara, co-founder of Kalshi, challenged the CME boss.

She asked whether CME had ever experienced market manipulation.

Duffy did not reach for the yes-or-no button.

“I have more people in my regulatory department than you do in your entire company,” he replied.

“Maybe you should learn a bit about efficiency then,” Lara shot back.

“Maybe you should learn about credible markets,” Duffy replied.

At which point the moderator performed the ancient Washington ritual of saying, “Let’s try to keep this productive.”

The exchange neatly captured the fault line running through the meeting.

The new prediction-market firms see old financial and gambling regulation as fragmented, slow and sometimes ill-suited to products that can be launched rapidly. The old exchange establishment sees a generation of companies discovering, with considerable enthusiasm, why market-integrity rules were invented in the first place.

Lara argued that every market has risks and that the purpose of regulation is to detect and address them rather than use their existence as an argument against innovation.

Duffy’s warning was essentially the inverse: one spectacularly bad product can set an industry back years. “When the financial industry takes bad behavior, it doesn’t take a step backwards,” he said. “It takes 20.”

Tom Farley, CEO of Bullish, later thanked Duffy and Lara for “spicing it up after three hours.”

“I’m wide awake,” he said.

The George Santos test

DRW founder Don Wilson offered perhaps the cleanest illustration of where even innovation-friendly market participants might draw the line.

He pointed to a Kalshi contract on whether former Congressman George Santos would attend the State of the Union. The CFTC and Kalshi ultimately dealt with the episode, Wilson noted, but he questioned why such a contract had existed in the first place.

The event was not particularly economically important, he argued, and its outcome was readily controllable by essentially one person.

It “never should have been listed in the first place,” Wilson said.

His preferred solution was not to strangle prediction markets but to cut out their bottom tier: reject products that fail basic standards so that contracts with genuine informational or hedging value — he cited Brexit and Federal Reserve decisions — can flourish.

That is arguably the central unresolved issue facing the CFTC. The interesting policy fight appears to be what separates a useful event derivative from a wager whose primary economic function is giving somebody a financial incentive to make something weird happen.

Armstrong proposed a presumption in favor of listing novel contracts unless regulators can identify a specific public harm, with further tests around causation and manipulability.

The CFTC itself acknowledges the problem. Selig said all event contracts must comply with core principles and not be readily susceptible to manipulation, while certain categories — including war, terrorism, assassination, gaming and illegal activity — carry additional public-interest considerations. The agency is preparing rules on product governance, market design and consumer protection.

Which leaves regulators contemplating questions that would once have sounded like jokes in a futures-law seminar: How much manipulability is too much manipulability? Is a hot-dog contest a legitimate event contract? Is betting on a politician’s vocabulary price discovery, entertainment or an invitation to shout helpful nouns from the audience?

Federal protection, but protection from whom?

The meeting also exposed a second contradiction.

Prediction-market companies want the CFTC to fend off state gambling regulators, arguing that federal regulation is both legally proper and better for consumers.

Rutgers professor Harry Crane delivered one of the day’s sharper attacks on state-regulated sports betting, accusing sportsbooks of “exploiting losers” and “banning winners.” He argued that state systems do not necessarily treat consumer protection as financial regulators would and said a federal principles-based regime could better protect both market participants and the public.

Lara likewise argued that Americans prefer regulated, onshore prediction markets and that state efforts to regulate federally supervised exchanges threaten a framework whose exclusive federal jurisdiction has long been central to derivatives regulation.

Selig is firmly on that side of the jurisdictional fight. His prepared remarks say the CFTC will defend its authority in court while simultaneously tightening the federal rules, including new consumer-protection requirements for retail event contracts.

“Federal pre-emption” sounds considerably more attractive if what is doing the pre-empting is a serious market regulator rather than merely a faster route to listing whatever somebody dreamed up before lunch.

By the end, even FanDuel — hardly an innocent bystander in the debate over where prediction markets end and sports wagering begins — was stressing “consumer trust,” clear rules, advertising standards and market integrity.

And committee chairman Walt Lukken supplied what may be the one sentence on which everybody could agree: nobody wants contracts that can be manipulated.

That sounds obvious.

After three hours of debate, it also sounded suspiciously like the easy part.

The frontier now needs fences

The CFTC said it created its Innovation Advisory Committee to help the regulator keep pace with technologies reshaping financial markets. Its membership reads like somebody seated the traditional exchange establishment beside crypto’s most aggressive builders and then deliberately removed the small-talk portion of dinner.

The result was revealing.

There was general agreement that the United States needs clearer crypto rules, broad enthusiasm for bringing financial innovation onshore, and considerable support for the CFTC asserting federal authority over prediction markets.

But beneath that consensus lies the harder fight.

The CFTC wants to accelerate. The industry wants permission to build. States are fighting to retain authority. Traditional exchanges want equal treatment. Prediction-market firms want room to experiment. And virtually everyone wants consumer protection — although they occasionally appear to have different consumers in mind.

Selig already began the meeting saying America had “crossed the Rubicon.”

By the prediction-market session, the industry had indeed reached the other bank.

There it found Duffy, waiting with 2,500 self-certifications, a hot-dog contest and several questions about what exactly everyone thought they were building.

Featured image: Mike Selig via X

The post CFTC’s Innovation Summit had everything: crypto lawfare, ‘fake news,’ hot dogs and a prediction market cage match appeared first on ReadWrite.

The Commodity Futures Trading Commission’s (CFTC) push to rewrite the rules governing prediction markets is unlikely to rescue sports event contracts from mounting legal challenges and could instead give opponents another avenue to sue the regulator, according to Better Markets policy director and COO Amanda Fischer.

Speaking on the Indian Gaming Association’s The New Normal webinar, Fischer argued that CFTC Chairman Michael Selig’s rulemaking drive amounts to an attempt to strengthen the federal case for prediction markets after platforms suffered damaging setbacks in court.

“The rulemaking, I mean, it’s just — they’re throwing the kitchen sink at it to try to shore up their legal case in court and basically confuse judges about what the law has been for, you know, 15 years longer,” Fischer said.

She described the effort as a “feeble attempt” to redefine gaming in a way that excludes sports and other products from restrictions on event contracts.

It’s a feeble attempt to try to shore up an area where they are overwhelmingly losing in court. – Amanda Fischer, Better Markets COO

Her comments come after a major defeat for prediction market operator Kalshi in Utah. On August 4, US District Judge Robert Shelby ruled that the Commodity Exchange Act does not preempt Utah from enforcing its anti-gambling laws against Kalshi, granting summary judgment to the state. The ruling rejected a central argument advanced by prediction market operators: that CFTC oversight of federally regulated derivatives exchanges prevents states from applying their gambling laws to event contracts.

CFTC is rewriting gaming rules as prediction markets lose in court

The CFTC has taken an increasingly assertive position under Selig. In March, the regulator began a new prediction-market rulemaking process while stating that it would exercise “exclusive jurisdiction” over the markets. In June, it proposed amendments to Regulation 40.11, including a new framework for determining whether contracts involve activities listed in the Commodity Exchange Act, such as gaming, war, terrorism and assassination. 

The June proposal also seeks to define terms including “gaming,” which appears to be central to the current dispute.

Fischer argued that the agency was trying to reinterpret a regulatory framework that had been understood for years to cover sports betting and other forms of gaming.

“They go in and they take something that the whole world has understood for 14 years to be pretty clear,” Fischer said, arguing that the agency is now effectively claiming that “gaming” should be more narrowly understood.

She suggested the strategy as an effort to signal to judges that the law is more ambiguous than opponents of prediction markets contend.

Rocha called the process “backfilling,” arguing that the CFTC appeared to be preparing its position for future court battles and potentially an eventual Supreme Court fight.

Fischer agreed that the timing matters, but said rulemaking is not where the underlying dispute will ultimately be decided.

“The rulemaking is important. Better Markets engaged on it, but it’s not the main show,” she said. “The main show is what’s happening in the courts.”

“If I had to pick a side that I thought would win in court when this is all settled, it would be your side,” Fischer told the IGA hosts.

Better Markets analyst says new CFTC rules could give opponents another route to sue

Rather than insulating prediction markets from litigation, Fischer said a final CFTC rule could itself become the subject of a court challenge.

She pointed to opposition submitted during the rulemaking process from tribes, states and attorneys general, arguing that the CFTC will have to demonstrate that its final decision is legally grounded, economically justified and not arbitrary or capricious.

“It’s going to be really, really difficult for them to finalize the rule in a way that checks all of the boxes that the court has established for reasoned rulemaking,” Fischer said.

“This rule is highly vulnerable to challenge from folks with standing to do so. So it opens up a whole new set of procedural infirmities that a challenger could also approach.”

The argument builds on Better Markets’ campaign against federal preemption of state gambling regulation. In April, the financial reform advocacy organization filed an amicus brief supporting Massachusetts in its dispute with prediction market operators, arguing that Congress never intended the CFTC to become a national gambling regulator.

Massachusetts has already secured a preliminary injunction requiring Kalshi to comply with state sports gaming laws if it wants to accept sports wagers from customers there. Attorney General Andrea Joy Campbell’s office said the January order prohibited Kalshi from accepting online sports wagers and related event contracts in Massachusetts without complying with state requirements, including licensing by the Massachusetts Gaming Commission. 

Better Markets has argued that prediction platforms function more like gambling businesses than traditional derivatives markets and that states are better equipped to police problems including gambling harms and potential market abuse.

Prediction markets may have weakened their case by moving into sports early

Fischer said the industry had weakened its own legal position by launching sports contracts before securing a clearer regulatory framework.

She argued that prediction market companies could have waited for the CFTC to rewrite its rules before entering sports, which would have provided a more defensible — although, in her view, still vulnerable — position.

“If the prediction markets — I don’t think that this is lawful and I don’t think it’s a good idea — but if they wanted to be greedy, but be more responsibly greedy,” Fischer said, they would have avoided sports contracts until after the rulemaking.

Instead, she said, operators effectively chose to “ask for forgiveness, not permission.”

Waiting could have taken as long as two years, she added, depriving companies of sports-related revenue during a crucial period.

“The rulemaking thing is like, it’s a CYA for the CFTC. It’s backfilling, as you said,” Fischer said. “If they were just a little more patient, they maybe could have had a more durable strategy. But again, even then, I think it would have been on thin ice.”

Clarity Act faces dwindling chances of clearing the Senate

The regulatory fight is unfolding as the crypto industry struggles to secure legislation from Congress.

Fischer described the Clarity Act as particularly significant because it would reopen the Commodity Exchange Act and shift substantial authority toward the CFTC. She argued that crypto and prediction markets are closely intertwined through investors, platforms and business strategies.

With congressional legislation uncertain, Fischer suggested federal agencies are increasingly trying to achieve through regulation what industry supporters have so far failed to lock in through statute.

She characterized the current moment as the “second half” of the industry’s political campaign.

“They’re doing increasingly novel, strange gambits in the courts and through the rulemaking apparatus to try to just grasp at anything they can to get the most done by the midterms and by the end of President Trump’s term,” Fischer said, arguing that the objective was to “future proof their business model” against less sympathetic regulators or Congresses.

Fischer predicted that an expected Senate cloture vote on the Clarity Act would fail to reach the 60 votes needed to proceed, pointing to unresolved disagreements over crypto regulation, banking, law enforcement and the extent of the powers being handed to the CFTC.

IGA Chairman David Z. Bean was similarly pessimistic.

“When they closed out, you know, they didn’t have enough votes to pass the Clarity Act, and I don’t think they will,” Bean said, adding that tribal representatives would return to Washington when Congress reconvenes to ensure lawmakers know that “Indian country is watching.”

The comments follow Bean’s previous criticism of congressional inaction over prediction markets. In a February appearance on The New Normal, he said lawmakers privately recognised the legal concerns surrounding the sector but were reluctant to act publicly.

“One-on-one in their office, in a safe space, they’re going to tell you it’s a problem, but that’s where it ends,” Bean said at the time.

SEC action cannot deliver the protections crypto wants from Congress

The CFTC is not the only regulator pursuing an aggressive rulemaking agenda while Congress remains deadlocked.

SEC Chairman Paul Atkins has made crypto reform a central regulatory priority. The SEC’s 2026 agenda says the regulator is working on clearer rules for crypto fundraising, custody and tokenised securities, with Atkins saying the commission wants to bring more products onshore while reducing regulatory barriers.

Atkins has also floated bespoke exemptions for crypto fundraising, including a potential startup exemption and a broader fundraising exemption, as well as an “investment contract safe harbor.” 

Fischer argued that regulatory action cannot provide the crypto industry everything it could obtain from legislation.

“Absent the Clarity Act and actually getting a change in law, I don’t think that the changes that they’re doing are going to end up being that durable or useful,” she said.

In particular, Fischer said the SEC cannot use rulemaking to deliver comprehensive immunity for earlier conduct or eliminate lawsuits brought by private plaintiffs and states.

“The SEC also can’t waive private plaintiff lawsuits and state lawsuits,” she said. “So it’s not great. But it’s also not going to be that durable, depending on the next SEC.”

Prediction markets are proving more politically divisive than crypto

Fischer also argued that prediction markets have become substantially more politically difficult for the administration than crypto.

While crypto has attracted support from Republicans and some Democrats, sports event contracts directly collide with state gambling regimes and tribal gaming compacts, creating opposition among lawmakers who might otherwise support the administration’s broader digital asset agenda.

“Prediction markets is very different,” Fischer said. “You actually have a huge split within the Republican caucus of legislators that know their communities and know their state Republican officials, their law enforcement officials, and they don’t like this, and they don’t like sports gaming taken out of their state and tribal jurisdiction.”

She pointed to bipartisan opposition aired during a Senate Indian Affairs Committee roundtable as evidence that prediction markets have become harder for the White House to embrace politically.

The CFTC, meanwhile, has doubled down on its federal jurisdiction argument. It has intervened in litigation around the country and in May sued Minnesota to block a state law targeting prediction markets. The agency has also participated in disputes involving Connecticut, Illinois, New York, Nevada and Massachusetts.

State penalties threaten the economics of prediction markets

Fischer said one of the biggest emerging threats to prediction market operators is whether states can recover money or impose penalties for activity that occurred before a final legal resolution.

“The play for the prediction markets, and it’s not stupid, is like, even if the Supreme Court ultimately sides against us, we would have had a good run,” she said.

“We did unregulated sports betting for a couple years and we made a bunch of money on it and we paid out our early investors and, you know, nice to know you.”

But she said the calculation changes dramatically “if there’s disgorgements and penalties for the conduct that occurred during this period.”

“That just turns the temperature way up on the litigation,” Fischer said.

The issue is already becoming concrete. Nevada regulators are seeking daily penalties of $120,000 from Kalshi in a dispute over geofencing, while Kalshi maintains that the state’s enforcement efforts conflict with federal law.

Midterms could trigger wave of CFTC and prediction market investigations

If political control shifts following the midterm elections, Fischer predicted the industry and the CFTC could face another threat: congressional investigations.

She said the unusual amount of scrutiny now surrounding the regulator, combined with allegations involving insider trading and questions over its dealings with prediction market companies, could generate extensive oversight.

“I would not be surprised if there’s not dozens of congressional hearings,” Fischer said, predicting lawmakers could call company executives to testify, issue subpoenas and investigate the relationship between platforms and their federal regulator.

“I think that legislators are going to be tripping over themselves to break stories on this ground,” she added.

Fischer went further when discussing the CFTC’s intervention in litigation involving prediction markets, saying she believed the regulator and platforms appeared to be coordinating their legal strategies.

“I cannot think of an example in my career of a federal agency moving so lockstep with firms that are the subject of litigation,” she said.

“If I were Congress, I would definitely try to get my hands on those communications to see just the level of integration between the government’s legal strategy and the prediction market’s legal strategy.”

Fischer did not predict criminal liability for Selig, but said congressional subpoenas, testimony and demands for communications could become significant if lawmakers decide to investigate.

Ultimately, she argued that the Supreme Court’s own recent approach to administrative power could make the CFTC’s strategy especially vulnerable.

“Agency rulemaking is powerful,” Fischer said, but courts have increasingly rejected federal agencies’ attempts to adopt novel interpretations of longstanding statutes.

“Going by the logic of the Supreme Court in the last like five, 10 years, what the CFTC is doing with this rulemaking should be outside the bounds,” she said. “The court should not defer to novel interpretations of long standing law and novel ways of redefining what gaming is.”

For an agency betting that new rules can strengthen prediction markets in court, Fischer’s warning was that the rulemaking designed to rescue them could instead become another front in the legal war.

Featured image: Canva AI-generated

The post CFTC prediction market rulemaking is a ‘feeble attempt’ to shore up losing court battle, Better Markets says appeared first on ReadWrite.

Michigan authorities took three machines suspected of being used for illegal gambling from a Muskegon bar during a search tied to an investigation of possible unlicensed gaming.

The Michigan Gaming Control Board searched DJ’s Pub at 2064 Henry St. under a warrant, working alongside the Michigan Attorney General’s Office and Muskegon Police Department. Regulators began looking into the bar after the gaming board received a tip in January.

During the search, investigators removed three machines they suspect were being operated as illegal slot-style games. Authorities also seized $1,200 worth of gift cards they believe the bar used to pay customers’ gambling winnings.

Another $3,874 believed to be proceeds from gambling was taken during the search. Investigators collected records they say are connected to the suspected gambling activity as well.

So far, authorities have made no arrests. The case is still under investigation.

According to the tip received in January, DJ’s Pub allegedly had gaming machines running without the required license. The tip also claimed customers who won were being paid with either cash or gift cards.

Over the next several months, investigators made multiple visits to the bar as they followed up on those allegations. They said they observed the machines being used during those visits.

Michigan regulators say illegal gambling machines paid winnings in cash and gift cards at Muskegon bar

Star 8, Inc. operates DJ’s Pub, which has previously faced state enforcement involving gambling at the establishment. The Michigan Liquor Control Commission took action against the business in 2021.

That earlier proceeding ended with the commission finding violations of Michigan’s Liquor Control Code related to illegal gambling taking place at the bar.

“Illegal gambling machines operate with no oversight, no consumer protections, and no accountability,” MGCB Executive Director Henry Williams said. “When we receive credible information that a business is running unlicensed gaming devices, we act on it. This search warrant reflects our continued commitment to enforcing Michigan’s gaming laws and holding accountable those who choose to operate outside them.”

State gaming officials say licensed gambling in Michigan is subject to regulatory rules and safeguards for consumers that illegal machines do not provide.

No charges connected to the latest search have been announced by authorities. Gaming regulators also noted that anyone accused in connection with the investigation is presumed innocent unless and until proven guilty.

People who have information about possible illegal gambling can report it to the MGCB through the agency’s 24-hour tipline or by email.

Those who want to submit information without identifying themselves can also use a written online tip form. The form is available through the Illegal Gambling Resources section on the gaming board’s website.

Authorities are continuing to investigate the suspected gambling activity at DJ’s Pub.

Featured image: Google Maps

The post Michigan regulators seize suspected illegal gaming machines from Muskegon bar search appeared first on ReadWrite.

Federal prosecutors want a Manhattan judge to keep the criminal case against Army master sergeant Gannon Ken Van Dyke on track for trial, rejecting his bid to throw out charges over Polymarket trades that allegedly earned him more than $400,000.

In a Wednesday (August 19) filing in the Southern District of New York, the government defended all five counts. Prosecutors say Van Dyke’s legal arguments belong before a jury rather than being grounds to dismiss the indictment.

“The core theory of the Indictment is that Van Dyke took information that he had pledged to keep confidential and, though he was duty-bound not to do so, he used it to make a personal profit,” prosecutors said.

Van Dyke, 38, served with U.S. Army Special Operations Command at Fort Bragg, North Carolina. Prosecutors say his work on Operation Absolute Resolve gave him access to classified and other nonpublic details about the mission.

He had also signed nondisclosure agreements covering classified information. In one agreement concerning “Western Hemisphere Operations,” Van Dyke acknowledged that information he obtained through his work “is now and will remain the property of the United States Government.”

Prosecutors say he used that knowledge to trade Polymarket event contracts involving U.S. military action in Venezuela and Nicolás Maduro’s removal from power.

Prosecutors say charges suggest US soldier used classified military information for Polymarket bets

Van Dyke opened his Polymarket account on December 26, 2025, according to the filing. From December 27 through Jan. 2, he allegedly spent about $33,934 on “YES” shares tied to Venezuela and Maduro while working on the operation.

One trade included roughly 13,769 shares betting Maduro would be out of power by January 31, 2026. Prosecutors say Van Dyke paid an average of about nine cents per share, implying roughly a 9% chance of that outcome.

U.S. special forces captured Maduro and his wife in Caracas before dawn on January 3. After the operation became public, several contracts settled at $1 per “YES” share, leaving Van Dyke with more than $400,000 in alleged net profit.

A grand jury indicted him in April on five counts spanning confidential government information, commodities and swap fraud, wire fraud and an unlawful monetary transaction. Van Dyke pleaded not guilty and was released on $250,000 bail with travel restrictions.

Prosecutors have described the matter as the Justice Department’s first criminal insider-trading prosecution involving prediction markets. The CFTC also sued Van Dyke in April, bringing a parallel civil case that has produced a separate fight over dismissal and whether proceedings should pause while the criminal prosecution continues.

Van Dyke moved to dismiss the criminal indictment on July 31, arguing in part that the contracts were not swaps under the Commodity Exchange Act and that classified military information was not property for wire-fraud purposes.

Prosecutors say the statutory definition of swaps is broad enough to cover event contracts with potential financial, economic or commercial consequences. They also point to case law and Van Dyke’s acknowledgment that confidential information remained government property.

Van Dyke “committed an old crime on a new platform,” they said.

“Because the Indictment alleges all that it must,” prosecutors said, “the next step is trial.”

Featured image: Gannon Ken Van Dyke / Facebook

The post Prosecutors urge judge to keep US soldier Polymarket insider case alive appeared first on ReadWrite.

Kalshi will not get immediate protection from Connecticut gambling enforcement after a federal appeals court rejected its request for temporary relief while its wider injunction bid remains pending.

The U.S. Court of Appeals for the Second Circuit issued its August 19 order in KalshiEX LLC v. Cafferelli. Kalshi had asked the court to stop Connecticut officials from enforcing state gambling laws against its sports-event contracts during its appeal.

“IT IS HEREBY ORDERED that, to the extent Appellant moves for a temporary injunction pending review by a three-Judge panel, the motion is DENIED,” the court said.

Circuit Judge Sarah A. L. Merriam issued the order in New York. The ruling followed Kalshi’s Aug. 17 emergency request and U.S. District Judge Vernon D. Oliver’s refusal two days earlier to pause enforcement.

Second Circuit temporary relief decision leaves Kalshi injunction request for three-judge panel in Connecticut

The Second Circuit left Kalshi’s larger request unresolved and sent it to a three-judge panel.

“The motion for an injunction is referred to a three-Judge panel, to be heard in tandem with Appellant’s motion for an injunction in KalshiEX LLC v. Williams, No. 26-1835,” the court said.

Connecticut officials also received permission to file a full response.

“Appellees’ motion for leave to file a full opposition by August 24, 2026 is GRANTED,” the order said. “Appellant may file a full reply in the ordinary course.”

Kalshi argues that the Commodity Futures Trading Commission has exclusive authority over its contracts under the Commodity Exchange Act.

“The district court therefore badly erred in denying Kalshi a preliminary injunction, and this Court’s intervention is necessary to prevent Kalshi from suffering irreparable harms under preempted state law before this Court has a chance to weigh in,” the filing says.

Kalshi also cited an August 11 CFTC emergency order tied to litigation in New York.

“Absent an injunction, Defendants could put Kalshi to an untenable choice between compliance with state law and a direct order from Kalshi’s federal regulator to do the opposite.”

Oliver previously found Kalshi had not shown its sports contracts were swaps subject to exclusive CFTC jurisdiction. He said the CFTC “lacks the authority to dictate an order that conflicts with this Court’s decision,” and rejected the appeal itself as grounds for emergency relief.

“While the Second Circuit may ultimately ‘disagree with certain features of this Court’s decision,’ the possibility for reversal alone (a possibility that exists in every appeal) does not warrant the extraordinary measure of injunctive relief,” Oliver wrote.

“A split in caselaw outside of this Circuit does not justify injunctive relief pending appeal, nor does the sheer fact that this is an issue of first impression,” Oliver wrote.

Connecticut first sent Kalshi a cease-and-desist letter in December 2025. Commissioner Bryan T. Cafferelli said, “Only licensed entities may offer sports wagering in the state of Connecticut. None of these entities possesses a license to offer wagering in our state, and even if they did, their contracts violate numerous other state laws and policies, including offering wagers to individuals under the age of 21.”

The Second Circuit gave no reason for denying temporary relief and has not decided the underlying enforcement dispute.

Featured image: Kalshi / Canva

The post Kalshi denied temporary shield from Connecticut gambling enforcement during federal appeal appeared first on ReadWrite.

Florida has become the latest state to take legal action at sweepstakes-style gaming, with Attorney General James Uthmeier suing the businesses behind Stake US and Virtual Gaming Worlds’ (VGW) Chumba Casino, LuckyLand and Global Poker.

The two complaints, filed Wednesday (August 19) in Hillsborough County Circuit Court, accuse the operators of running illegal online casinos while presenting their products as sweepstakes or social gaming. Payment companies and other businesses that allegedly helped the platforms process transactions are also defendants.

“If it looks like a casino, takes money like a casino, and pays out like a casino, it is a casino—and it’s illegal in Florida,” Uthmeier said in announcing the lawsuits.

He made the same case in a video released alongside the legal action, arguing that the labels used by the companies do not reflect how their games actually work.

“Sites like Stake and those run by VGW market themselves as sweepstakes or social casinos, but they offer real gambling: slots, blackjack, and poker,” Uthmeier said. “They’ve raked in hundreds of millions of dollars from people in our state.”

The claims have yet to be tested in court, and the defendants will have an opportunity to contest them. They also arrive during a general state-level push against sweepstakes casinos, with regulators and attorneys general increasingly questioning whether dual-currency systems amount to real-money gambling.

Florida says sweepstakes currencies amount to real-money gambling

Florida’s 64-page Stake complaint names Sweepsteaks Ltd., which operates Stake.us, alongside Easygo Group Holdings, Medium Rare N.V., Kick Streaming, Stake co-founders Bijan Tehrani and Ed Craven, and payment businesses Praxis Tech and Breeze Labs Payments.

Florida says users put money or other things of value into the platform, receive wagering credits and use them on games of chance before redeeming eligible winnings for something with monetary value. The state argues that process makes the underlying activity casino gambling, regardless of how Stake.us describes the product.

The state questions how money moves through Stake.us. Players can use Gold Coins without winning cash prizes, while Stake Cash can eventually be exchanged for cryptocurrency or digital gift cards. Florida says that makes Stake Cash function much like chips at a conventional casino.

The complaint says that once players meet the required wagering conditions, Stake Cash can be redeemed at or close to a one-to-one dollar value.

Stake.us promotes itself as “America’s Favorite Social Casino and Poker,” according to the complaint.

Florida argues that buying and wagering Stake Cash provides the consideration needed to make the activity gambling, while games of chance provide the opportunity to win something valuable.

“Slots and similar casino-style gambling are illegal in Florida, except under limited circumstances expressly authorized by law, none of which apply here,” the Stake complaint states.

“These companies cannot hide illegal gambling behind a sweepstakes label,” Uthmeier said.

The case also reaches companies Florida says helped make deposits and payouts possible. Praxis allegedly connects the platform with banks and processors, while Breeze supports electronic payment methods that include cards, Apple Pay and Google Pay.

Marketing is another major part of the complaint. Florida points to influencers, livestreams, celebrity endorsements and sports sponsorships, including promotions involving rapper Drake. The state argues that such campaigns can highlight unusually large wins without giving comparable attention to losses or the odds of achieving those results.

It points to social-media posts showing purported Drake wagers of about $300,000 and $250,276.85, with possible payouts topping $507,000 and $460,000 respectively.

Florida also alleges that some influencers or celebrity endorsers who appear to be gambling may be using money supplied or subsidized by operators rather than risking entirely their own funds.

The complaint also cites company accounts reviewed by the Financial Times showing gross gaming revenue climbing from roughly $105 million in 2020 to nearly $2.6 billion in 2022, while a Forbes profile put 2024 gross gaming revenue at about $4.7 billion. Florida alleges the company has also made significant revenue from consumers in the state, although the cited complaint material does not provide a specific Florida figure.

Stake has faced scrutiny elsewhere. An April lawsuit in New York accused Stake.com, Stake.us, Coinbase and related businesses of enabling gambling by a plaintiff who said he began using Stake-related platforms at age 13. That case alleges Coinbase acted as a payment bridge between conventional currency, cryptocurrency and offshore gambling.

The plaintiff says he used Stake.com and Primedice from ages 13 through 19, eventually losing his own savings and using his father’s credit card without permission. The complaint says his gambling affected school, family relationships and his transition into adult life, and alleges Stake-related businesses used livestreams, celebrity endorsements and influencer promotions to attract younger users.

VGW faces Florida lawsuit after retreating from other states

Florida’s separate 74-page VGW case names U.S., Australian and Maltese VGW companies together with payment businesses Yodlee, Trustly and Worldpay.

Once again, the state is focusing on a two-currency setup. Customers obtain Gold Coins and Sweeps Coins, with VGW describing Sweeps Coins as a free bonus connected with Gold Coin purchases. Florida argues the economic reality is different because Sweeps Coins can be played and later redeemed for value.

One example in the complaint describes a $20 package that includes millions of Gold Coins and 20.50 Sweeps Coins. With Sweeps Coins redeemable at $1 each, Florida alleges the transaction effectively sells wagering currency despite the “free” label.

It also challenges promotional language surrounding VGW’s games. LuckyLand has described playing as “100% safe and 100% legal.” Florida says that representation is deceptive because, in the state’s view, the games amount to unlawful gambling.

Cash-out rules also feature in the case. Florida says Chumba permits gift-card redemptions from $10 but sets a $100 threshold for cash, while other VGW platforms require 50 Sweeps Coins before players can cash out.

Florida is also pursuing the companies it says helped move that money. The complaint describes Trustly as facilitating account-to-account transfers and Worldpay as providing payment processing, merchant acquiring, gateway and payout services. The state alleges Yodlee, Trustly and Worldpay helped the wider operation by facilitating transactions involving Florida players.

VGW companies are alleged to operate as a common enterprise and use celebrities, athletes and influencers to give their platforms legitimacy while presenting the games as safe, social, secure, legal or free.

The complaint puts VGW’s 2025 revenue above $5 billion, including about $3.7 billion attributed to Chumba Casino. Florida says that scale could make disgorgement significant if the state succeeds.

The lawsuit follows pressure on VGW in several other states. In West Virginia, the company announced in November 2025 that it would phase out Promotional Play while continuing free-to-play Gold Coin games. Players stopped collecting Sweeps Coins on November 11, gameplay using them ended November 18, and redemptions closed November 25. The withdrawal followed enforcement pressure in the state and came after VGW had already wound down some sweepstakes operations in New York and New Jersey.

It included reported subpoenas or cease-and-desist letters sent to sweepstakes operators by Attorney General JB McCuskey earlier in 2025. McCuskey said at the time that his office had “serious concerns” about consumers, particularly children, being targeted by illegal gambling operations.

Kentucky added another front in June 2026, suing VGW over Chumba Casino, LuckyLand and Global Poker. Kentucky alleges Sweeps Coins work like conventional casino chips because they can carry redeemable value and be wagered on games of chance. 

VGW previously told ReadWrite it “respectfully reject[s] the Kentucky Attorney General’s claims” and plans to “vigorously defend this lawsuit.” The company said it has operated lawfully in the United States for more than a decade and describes its products as online “Social Plus” games offered with “robust consumer protections.”

Florida seeks consumer losses as well as sweeping injunctions

Florida is asking for more than an order stopping the platforms. Its lawsuits rely partly on state gambling-loss recovery statutes that the Attorney General argues allow the government to pursue money or property tied to illegal gambling.

The state specifically relies on sections 849.12 and 849.29 of the Florida Statutes, arguing they can impose joint and several liability on operators, promoters and others involved in the transactions. The VGW complaint’s first count seeks forfeiture and recovery of money allegedly lost through gambling from all defendants.

In the Stake case, Florida seeks forfeiture and recovery of “all sums of money” and other valuable property allegedly wagered, used or won by people gambling in the state. The requested remedies also include disgorgement, restitution and a permanent injunction.

Florida is separately pursuing civil penalties that can reach $10,000 for each willful consumer-protection violation and $15,000 for certain violations involving people over 60 or consumers who are impaired or disabled.

The VGW suit similarly asks for gambling-related losses to be recovered, along with restitution, disgorgement, penalties and permanent injunctive relief.

“These websites do not follow the safeguards or provide consumer protections that are required of licensed casinos under Florida law,” he said in the video statement. “We filed lawsuits against the operators of these sites, along with their financial facilitators and promoters.”

“We’re seeking to recover every dollar consumers lost under Florida’s gambling recovery laws,” Uthmeier added, “and we will hold them accountable under our consumer protection laws for their deceptive claims.”

The cases fit an increasingly national dispute over where newer gambling-like products sit under existing law. Montana became the first state to outlaw online sweepstakes casinos in May 2025, while West Virginia’s enforcement pressure helped drive VGW’s withdrawal of Promotional Play.

Kentucky has meanwhile targeted both sweepstakes casinos and prediction markets, suing VGW alongside Kalshi and Polymarket in June. The cases raise different regulatory questions, but they share a central argument now appearing repeatedly across states: changing the technology, currency or legal label around a product does not necessarily take it outside traditional gambling laws.

Both complaints, filed in Hillsborough County Circuit Court and dated August 19, 2026, demand jury trials.

ReadWrite has reached out to VGW and Stake for comment.

Featured image: Stake.us / VGW

The post Florida lawsuits target Stake and VGW as sweepstakes pressure grows appeared first on ReadWrite.