The U.S. Senate rejected a procedural motion needed to advance the CLARITY Act on Tuesday, blocking legislation that tribal-gaming operators and lawmakers said was a crucial step toward stopping prediction-market companies from offering sports-event contracts outside state and tribal gaming systems. Senators voted 49-50 against cloture, falling well short of the 60 votes required.

The failed vote rejected a procedural step that limits debate on whether to take up the legislation at all. The CLARITY Act would establish rules for crypto markets and clarify the respective responsibilities of the Securities and Exchange Commission and the Commodity Futures Trading Commission. Even if cloture had passed, the bill would still have needed to return to the House for consideration, and it is now likely dead for 2026, with no realistic path to reconciliation until after the November midterm elections.

Cortez Masto Cites Illegal Gambling Concerns

Senator Catherine Cortez Masto, D-Nevada, said the bill would allow prediction markets to continue operations she characterized as illegal gaming that ignores state and tribal law. She said the version under consideration marked a step backward from language passed out of the Senate Banking, Housing and Urban Affairs Committee and argued it undermined law enforcement’s ability to investigate crypto crimes, according to a statement following the vote. Senator Jacky Rosen, D-Nevada, joined Cortez Masto in voting no.

Supreme Court Petitions Loom Over the Fight

Cortez Masto’s objections come as Crypto.com and Robinhood have petitioned the U.S. Supreme Court to consider whether the Commodity Exchange Act preempts states from regulating sports-event contracts through their own gaming laws. That filing follows a Ninth Circuit ruling affirming a Nevada judge’s decision to dissolve an approved Kalshi injunction, allowing state gaming regulators to enforce state gambling laws against sports-event contracts. Whether the Supreme Court takes up either writ of certiorari remains unknown.

The Indian Gaming Association, tribal nations and partner organizations had lobbied Congress for months to reject any CLARITY Act version that failed to explicitly protect tribal sovereignty, the Indian Gaming Regulatory Act, tribal-state compacts, and the authority of tribal and state governments to regulate gaming within their jurisdictions – concerns detailed in tribal leaders’ warnings to Congress over prediction-market expansion.

DeFi Language Divided Operators

The revision at issue specified that the bill’s DeFi provisions apply only to spot and cash digital-commodity transactions, a distinction reportedly meant to reduce the risk that broad DeFi language would inadvertently rewrite regulations governing event contracts. Tribal and commercial operators and state gaming regulators opposed the revision regardless, arguing it left the door open for federally regulated platforms to sidestep existing oversight – a tension that has also shaped CFTC rulemaking fights over prediction markets.

David Bean, chairman of the Indian Gaming Association, called the Senate’s failure to advance H.R. 3633 a victory for tribal sovereignty but warned the fight against illegal prediction markets offering sports-event contracts continues. He said the association would keep pushing for federal legislation and regulatory action protecting IGRA and tribal-state compacts from preemption, preserving tribal authority to regulate gaming, and prohibiting federally regulated prediction markets from offering sports betting and casino-style gambling through event contracts or decentralized finance platforms.

What Comes Next

With reconciliation unlikely before the midterms, attention shifts to the Supreme Court’s undecided call on the Robinhood and Crypto.com petitions and to ongoing regulatory discussions, including recent industry conversations reflected in CFTC summit talks on prediction-market rules. Bean said any future legislation on digital assets or prediction markets must begin from a clear principle that tribal sovereignty is not negotiable.

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Kalshi and Polymarket Global combined for $14.10 billion in contract volume during the Sept. 7-13 week that opened the NFL regular season, according to a DeFi Rate volume report. That was up 9.3% from $12.90 billion the previous week, with football, US Open tennis, esports playoffs and Federal Reserve positioning among the main drivers of activity.

Kalshi Widens Its Lead

Total trades across both platforms climbed 10.7% to 86.50 million. Kalshi generated $12.98 billion of the combined volume, up 9.4% week over week, giving it a 92.1% share, a record for the platform. Polymarket Global rose 7.6% to $1.11 billion, or 7.9% of the total, while Polymarket US logged $818.52 million across its five available daily reports.

Sports contracts were the largest source of retail trading activity during the week, with Kalshi and Polymarket Global combining for $3.76 billion. Kalshi accounted for $3.265 billion, while Polymarket Global’s sports volume jumped 104.7% to $498.81 million. On Kalshi, the New England-Seattle market generated $57.86 million. Other high-volume NFL markets included San Francisco-Los Angeles at $45.30 million and Washington-Philadelphia at $28.48 million.

A Sixth Straight Week of Growth

The Sept. 7-13 result capped a six-week period from Aug. 9 through Sept. 13 in which DeFi Rate reported five consecutive weeks of higher Kalshi volume. Weekly volume increased from $8.069 billion in the week ending Aug. 9 to $12.983 billion in the week ending Sept. 13, a 60.9% increase over the period. Kalshi’s September month-to-date volume through Sept. 13 reached $23.45 billion, 53.4% higher than the same period in August.

Away from football, Polymarket Global’s Fed Decision in September market generated $48.85 million, up 48.8% from $32.83 million the week before. Four League of Legends playoff matches on the same platform combined for more than $38.74 million in weekly volume.

Combos, Open Interest, and the Sportsbook Question

Kalshi’s multi-leg combo contracts, which allow traders to combine several predictions into one position, reached $1.93 billion in volume. That represented 99.4% of the combined $1.95 billion combo market between the two platforms. Open interest as of Sept. 13 stood at 677.18 million contracts on Kalshi, 321.34 million on Polymarket Global and 164.19 million on Polymarket US.

The week’s data also underscored the breadth of activity across sports, economic and esports markets. Kalshi held the larger share of combined volume, while Polymarket Global recorded gains in sports trading and activity around the upcoming Federal Reserve decision.

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Polymarket launched event contracts tied to private-company milestones this week, expanding into IPO timing, valuation targets and secondary-market activity for firms including OpenAI, Anthropic and Stripe. The move landed the same week the Securities and Exchange Commission said it would seek public input before clearing prediction-market ETFs for launch, a signal that the agency is taking more time rather than issuing an outright rejection.

The private-company contracts run through a new partnership with Nasdaq Private Market, which will supply the data used to resolve each contract. Early markets ask whether companies like OpenAI, Anthropic, Stripe, Databricks and Kraken will hit specific valuation thresholds by set dates, structured as simple yes-or-no outcomes rather than any claim on equity.

Polymarket and Nasdaq Private Market described the product as a way to widen access to price discovery in a corner of finance that has largely been reserved for venture firms, institutions and accredited investors. That expansion comes as Polymarket faces broader scrutiny over its banking relationships and regulatory footing as it pushes into new product lines.

SEC Weighs Novel ETF Structures

SEC Chair Paul Atkins said Wednesday the agency wants to gather public input on how it should handle prediction-market ETFs and other novel products, framing the review as a way to work through the implications transparently, according to Atkins. The proposed funds would wrap event contracts inside a traditional ETF structure, giving investors exposure without trading directly on a platform like Polymarket or Kalshi.

Issuers including Roundhill, Bitwise and GraniteShares have already filed products tied to elections, recessions, tech layoffs and oil prices. The broader debate over how financial regulators should treat event contracts now extends to whether those payoffs belong inside a mainstream investment wrapper at all.

States Keep Pushing Back

The CFTC and Justice Department sued Minnesota this week over a law the agency called the first outright state ban on prediction markets, filed less than a day after Governor Tim Walz signed it. The law takes effect Aug. 1, and the complaint argues Minnesota is trying to regulate derivatives markets that fall under the CFTC’s exclusive jurisdiction – a fight that echoes suits already filed against Arizona, Connecticut, Illinois and New York.

Polymarket also filed with the CFTC to list parlay-style sports contracts in the U.S., with a stated listing date no earlier than May 21, adding to the legal pressure already surrounding sports-related prediction contracts. A Senate Commerce Committee hearing the same week raised questions about whether such contracts could invite athlete cheating, expose minors to gambling-like products, or undercut state and tribal gaming systems.

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The Ninth Circuit Court of Appeals ruled on August 28 that sports-related event contracts offered by prediction-market platforms are not swaps under federal commodities law, clearing the way for Nevada to apply its own gaming regulations to those products. The decision, detailed in ReadWrite’s earlier coverage of the case, denied requests for injunctive relief from Kalshi, Crypto.com, and Robinhood.

All three platforms had asked the court to stop the Nevada Gaming Control Board from shutting down their sports-outcome contract offerings in the state. The court’s finding, according to Insider Monkey’s report via Yahoo Finance, was that these contracts function as sports bets rather than federally regulated swaps, putting them squarely within reach of state gambling law.

The classification question sits at the center of a wider fight. Prediction-market operators and the CFTC have argued that event contracts, including sports-outcome products, qualify as swaps subject to exclusive federal jurisdiction, which would bar states from regulating or banning them outright. Forty-four states have pushed back, arguing the products are sports betting dressed up in derivatives language, a dispute tribal leaders have also raised with Congress.

Why the Timing Matters for Sportsbooks

Platforms like Kalshi have used the federal-swap designation to offer sports-outcome betting in states where traditional sportsbooks remain restricted or banned. That workaround has been a genuine competitive threat: DraftKings and Flutter have faced sustained valuation pressure over the past year, with analysts citing prediction markets’ rapid growth as a headwind, a trend also visible in recent NFL betting-growth data.

Shares of both companies jumped after the ruling. DraftKings gained as much as 10% and Flutter rose as much as 8% on August 28, per Insider Monkey’s figures. The move came despite institutional investors having already pulled back: DraftKings’ hedge fund ownership fell from 61 funds in the first quarter to 54 in the second, while Flutter’s dropped more sharply, from 57 to 37 over the same stretch.

A Bernstein research note cited by Intellectia.AI adds context to how unsettled the legal picture remains. The note points to a separate 2-1 Third Circuit ruling in Flaherty v. KalshiEX that treated sports event contracts as swaps, and says New Jersey has since asked the Supreme Court to review that decision – a filing that arrived five days after the Ninth Circuit’s contrary ruling. Bernstein’s analysts described the near-term outcome as more likely to be a regulatory patchwork than a clean, nationwide resolution.

What Comes Next

Kalshi filed a petition for rehearing on September 9, and a Supreme Court review remains possible, both developments Insider Monkey flags as the key markers for whether this ruling holds. The court’s opinion itself, filed in KalshiEX, LLC v. Assad, is available from the Ninth Circuit for anyone tracking the underlying legal reasoning.

None of this settles the jurisdictional question nationally. The ruling applies to one circuit’s reasoning on one set of Nevada-related claims, and prediction-market operators have both the incentive and the legal resources to keep contesting it. Insider Monkey’s own read is that a single-day stock rally proves little on its own – a sustained institutional bid in DraftKings and Flutter, rather than a one-time price pop, would be the stronger signal that the competitive landscape has actually shifted.

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Underdog Exchange DCM, Inc. and UDM, LLC, which does business as Underdog Predict, have taken regulators in Ohio, Massachusetts, and Wisconsin to federal court, after dropping Drafts in seven states this week. The company wants judges to stop both states from applying their gambling and sports betting laws to event contracts offered through its federally regulated market.

The cases, filed in federal courts in Ohio, Massachusetts, and Wisconsin, add Underdog to a widening legal fight over who gets to regulate prediction markets. Platforms argue these products fall under federal commodities law, while states increasingly view sports contracts as ordinary wagers that require local gambling licenses.

In Ohio, Underdog sued officials including Attorney General Andy Wilson and Ohio Casino Control Commission Interim Executive Director Andromeda Morrison. It says its status as a designated contract market and futures commission merchant places the contracts within the Commodity Futures Trading Commission’s authority under the Commodity Exchange Act.

Ohio has already taken an aggressive approach toward rival Kalshi. In April, the Casino Control Commission proposed a $5 million penalty for allegedly conducting unlicensed sports gaming. Kalshi has fought the state in federal court, although an Ohio judge previously declined to block enforcement while that litigation continued.

Underdog says that leaves it facing the same regulatory threat: “The threat of Defendants’ enforcement of Ohio law poses a direct and imminent threat to Underdog’s business and its users, and leaves Underdog with a ‘Hobson’s choice’… Either Underdog can continue to operate in Ohio, ‘expos[ing] [itself] to potentially huge liability’… or it can ‘suffer the injury of obeying [Ohio’s] law’ despite the fact that it is preempted.”

Prediction market regulation now hinges on a growing federal-state split for Underdog and other platforms

In Massachusetts, Underdog sued Attorney General Andrea Joy Campbell and Massachusetts Gaming Commission Executive Director Dean Serpa. The challenge arrives after Massachusetts secured a preliminary injunction restricting Kalshi’s sports-related event contracts.

Underdog argues state intervention conflicts with federal market rules and the Constitution’s Supremacy Clause. It also maintains that event derivatives can serve price discovery and hedging purposes instead of operating like conventional sportsbooks.

The legal picture is increasingly divided. In August, the Ninth Circuit ruled that Kalshi’s sports event contracts were sports bets rather than swaps, allowing Nevada to enforce its gambling laws. That decision conflicts with the Third Circuit’s earlier approach favoring Kalshi against New Jersey.

Wisconsin has become another front. Attorney General Josh Kaul brought enforcement actions involving Kalshi, Polymarket, Crypto.com, Robinhood and Coinbase. Kaul stated: “Thinly disguising unlawful conduct doesn’t make it lawful. These companies’ alleged facilitation of sports betting in Wisconsin should be shut down.”

The CFTC later sued Wisconsin officials. CFTC Chairman Michael Selig issued a stern warning against state interference: “Our message to Wisconsin is the same as to New York, Arizona, and others: if you interfere with the operation of federal law in regulating financial markets, we will sue you.”

Wisconsin litigation also extends to tribal gaming. A federal judge allowed the Ho-Chunk Nation’s central claims against Kalshi to continue, finding the tribe had plausibly alleged that accessible sports contracts could constitute class III gaming on tribal land.

Against that unsettled backdrop, Underdog is asking both federal courts for permanent injunctions and declarations that federal commodities law preempts the states’ gaming restrictions.

Featured image: Underdog

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Coinbase says Kalshi caused a mistaken prediction-market settlement tied to Michigan’s wild 13-12 win over Western Michigan. The crypto company plans to make affected winners whole while letting customers keep money they received because of the original error.

The dispute stems from a game that appeared finished before officials restored one second, giving Michigan another play and changing the result.

CNN correspondent Marshall Cohen reported Monday (September 7) that Coinbase customers were caught up in the problem. Screenshots reviewed by Cohen showed Coinbase apologizing for “an issue with the settlement” and saying it was “manually recalculating the balances for all affected accounts.”

Cohen later shared a Coinbase statement that pointed directly at Kalshi.

“An erroneous settlement by Kalshi led to certain positions being underpaid.”

Coinbase plans to credit affected customers with the full amount their winning positions should have paid. Customers who received money because of the earlier, incorrect result will also be allowed to keep it.

“Payouts already made under the original incorrect settlement will stand and will not be reversed or recovered,” the statement said.

That differs from Kalshi’s handling of the mistake, which involved reversing payouts issued when Western Michigan was initially treated as the winner.

Coinbase will pay rightful Michigan winners without clawing back mistaken payouts

No. 16 Michigan trailed Western Michigan 12-7 when quarterback Bryce Underwood launched what looked like the game’s final pass. The Hail Mary was incomplete, the clock showed zero and Western Michigan began celebrating an apparent upset.

After reviewing the play, officials concluded Western Michigan’s Micah Davis had touched the ball after jumping from out of bounds with one second remaining. The Big Ten later said Davis “started his jump from an established out-of-bounds position” before touching the ball.

Michigan received another snap, and Underwood found JJ Buchanan for a 47-yard Hail Mary touchdown that produced the 13-12 victory.

“One for the history books right here,” Michigan coach Kyle Whittingham said after the game.

The restored second remained controversial. ReadWrite reported that broadcast footage appeared to show zero on the clock before Davis made contact. Western Michigan asked for clarification but said it would not appeal.

Kalshi had already settled its “Western Michigan vs. Michigan” market by the time the review ended. We previously put trading volume at about $18.6 million. Kalshi initially paid positions based on a Western Michigan victory.

Cohen later reported that Kalshi admitted it had “wrongly and prematurely settled” the market. Kalshi reversed those payouts, reimbursed traders mistakenly treated as losers and paid positions matching Michigan’s official win.

“We corrected the result to a Michigan win, making sure all Kalshi customers got paid out correctly.”

ReadWrite also reported that a customer shared a Kalshi email saying the market had been settled “to the wrong outcome” before being “re-settled to the correct result.”

Coinbase is taking another route. Cohen said the company blamed Kalshi for the Michigan “prediction market snafu” but would “let the wrongful winners keep the payouts.”

Featured image: Canva

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Americans are projected to legally bet $29.5 billion on the 2026 NFL season through regulated commercial sportsbooks, according to a new American Gaming Association estimate. That would barely move from the $29.4 billion wagered last season, pointing out a sharp slowdown after years of major expansion.

The AGA says the numbers cover legal, state-regulated commercial sportsbooks. It argues that prediction markets are increasingly competing for sports wagers while offering contracts nationwide, including in states where conventional sports betting remains illegal.

“We’re excited for the NFL season to kickoff, as are millions of fans eager to engage with their favorite teams. Since the Supreme Court struck down the federal sports betting ban in 2018, legalized sports betting had seen tremendous growth,” said AGA President and CEO Bill Miller. “But this year is different. Since the widespread launch of backdoor sports betting on so-called “prediction markets,” the growth of legal handle has stalled.”

Prediction markets squeeze growth in regulated NFL betting

The slowdown follows a year in which prediction platforms sharply increased their visibility. Sensor Tower research compiled for the AGA found licensed sportsbook digital advertising impressions fell nearly 14% during 2025. Meanwhile, prediction-market advertising surged, and about 43% of digital sports wagering ads seen during early 2026 lacked state-mandated responsible gaming messages because they came from prediction-market operators.

Kalshi alone generated roughly 5.2 billion advertising impressions early this year, compared with around 2.9 billion for FanDuel. The AGA also says sports contracts now account for about 80% of Kalshi’s volume.

Questions over oversight reached Congress in May, when senators heard competing arguments about whether sports event contracts should fall under federal commodities rules or state gambling laws. AGA officials portrayed the platforms as sportsbooks operating outside established state systems, while industry representatives argued they are federally regulated exchanges where users trade against each other.

Age restrictions are another dividing line. The AGA estimates users aged 18 to 20 generated $5.1 billion in Kalshi volume, although that group falls below the legal sports betting age in 35 of the 40 jurisdictions allowing wagering.

“These “prediction market” platforms are dangerously misleading consumers by marketing sports wagers as an investment, rather than what it is: entertainment,” Miller added. “Kalshi and other “prediction markets” say they don’t need to follow state- and tribal- regulated sports betting laws or pay state gaming taxes. Their defiance means consumers, including teenagers and freshmen, placing bets without the protections, oversight, and accountability that the legal market provides.”

The AGA calculated its $29.5 billion projection using 2026 national handle growth, last season’s estimated total and football-specific data from selected states. It includes preseason betting, futures placed from March onward, the playoffs and Super Bowl LXI in February 2027.

Featured image: Canva

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Kalshi had to undo payouts on a college football prediction market after declaring Western Michigan the winner against Michigan before officials had actually finished deciding the game.

The heavily traded “Western Michigan vs. Michigan” market drew about $18.6 million in trading volume, according to reports from CNN correspondent Marshall Cohen and NBC Sports. Kalshi first paid contracts based on a Western Michigan victory, then reversed those transactions and ultimately paid traders holding the winning Michigan contracts.

“We corrected the result to a Michigan win, making sure all Kalshi customers got paid out correctly,” Kalshi said in a statement shared by sports betting reporter Bill Speros.

No. 16 Michigan was trailing 12-7 when quarterback Bryce Underwood threw an apparent final Hail Mary. The pass fell incomplete and the clock showed zero, sending Western Michigan into celebrations.

Officials then reviewed the play. They ruled Western Michigan’s Micah Davis had touched the ball after jumping from out of bounds while one second remained. The Big Ten later said Davis “started his jump from an established out-of-bounds position” and made contact before time expired.

That decision handed Michigan another snap. Underwood found JJ Buchanan for a 47-yard Hail Mary touchdown, completing a 13-12 Michigan victory.

“One for the history books right here,” Michigan coach Kyle Whittingham said afterward.

The restored second remained disputed, with broadcast footage appearing to show zero before Davis touched the ball. Western Michigan sought clarification but said it would not appeal.

Michigan early market payout exposes Kalshi settlement risks

Kalshi, meanwhile, had already treated Western Michigan as the winner. Cohen reported that the company acknowledged it had “wrongly and prematurely settled” the market. It clawed back those payouts, restored funds to traders initially marked as losers and paid Michigan contract holders. NBC Sports reported the same sequence.

One customer later posted an email attributed to Kalshi that said: “Yesterday evening the Western Michigan vs Michigan market was initially settled to the wrong outcome.” It added that payouts were reversed and the market “re-settled to the correct result.” Another user claimed that some were given $50 as compensation.

The episode follows another Kalshi controversy over how prediction contracts are resolved. Earlier in 2026, its market on whether Iran’s Supreme Leader Ali Khamenei would leave office caused confusion after his reported death. Kalshi said its rules contained a death carveout requiring settlement using the last traded price rather than automatically resolving the contract YES. The company later reimbursed fees and net trading losses after users complained about how those rules had been understood.

Both episodes highlight the same pressure point: prediction markets need clear rules for deciding not only what counts as an outcome, but when that outcome is final.

NBC Sports’ Mike Florio summed up the Michigan episode with a familiar warning: “It ain’t over ’til it’s over.”

For sports contracts, Michigan’s extraordinary final second showed why rapid settlement carries real risk. A market can look finished, traders can get paid and the apparent result can still change before the game officially ends.

ReadWrite has reached out to Kalshi for comment.

Featured image: Michigan Football via X

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Underdog Fantasy is pulling new Drafts entries from seven U.S. states this week after founder Jeremy Levine said regulators left the company facing a choice between state fantasy licenses and products licensed by the Commodity Futures Trading Commission.

Levine said on social media September 5 that the cutoff will take effect immediately after Wednesday’s kickoff in Massachusetts, Maryland, Michigan, Mississippi, New Jersey, Pennsylvania and Ohio.

“Drafts community, I have some not fun news to share,” Levine wrote. “Right after kickoff on Wednesday, we will be shutting down Drafts in seven states: MA, MD, MI, MS, NJ, PA and OH.”

Already-entered contests will still go ahead. Levine said existing entries will “continue as normal,” although customers in those states cannot submit new Drafts entries after the deadline.

The change scales back one of Underdog’s earliest fantasy offerings at a time when daily fantasy sports rules continue to differ widely across the country.

CFTC licensing clash forces Underdog to pull Drafts from seven states

Levine said state regulators have taken a position Underdog disputes, linking the company’s ability to hold fantasy licenses with its CFTC-regulated offerings.

“Those states have taken a legal viewpoint we disagree with: if we offer our CFTC-licensed products we cannot offer fantasy sports in those states,” Levine wrote. “So we had to choose.”

He said Underdog’s options were to keep its fantasy licenses in those jurisdictions or give them up while continuing what he called “effectively our full experience, minus Drafts.”

Fantasy sports oversight has traditionally happened state by state, leaving operators to navigate different rules and licensing requirements. Massachusetts, for example, regulates DFS operators serving residents and sets consumer safeguards covering areas including minors, college sports contests and customer funds.

Underdog has faced regulatory pressure elsewhere, although under different circumstances. In California last year, it changed its DFS pick’em offering to a peer-to-peer format as questions continued over the legal treatment of fantasy sports. PrizePicks made a similar shift.

California Attorney General Rob Bonta had issued a legal opinion addressing daily fantasy sports and later said his office planned to enforce that interpretation against operators continuing to offer games covered by it.

“We expect our legal opinion to be followed and complied with by everyone governed by it,” Bonta said at the time.

Underdog challenged California’s position but failed in its effort to stop the opinion from being issued, then moved its California pick’em contests to the peer-to-peer format.

This seven-state withdrawal involves a different issue, with Levine specifically pointing to the clash between state fantasy licensing and Underdog’s CFTC-licensed products.

For Levine, the decision also hits a product closely tied to Underdog’s early history.

“I love Drafts,” he wrote. “It was the first game we ever launched and a big part of what built Underdog.”

Levine said Drafts now draws usage “anywhere near” the company’s other products, while stressing that the format and its community remain important.

“We have some ideas about how to get Drafts back to more customers, but it’s too early to commit to anything yet,” he added. “I’m optimistic, and we’re definitely going to try.”

Featured image: Underdog

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Bally’s Corporation is changing finance chiefs as the casino company pours money into major developments, deals with financial pressure and fights over video gambling terminals in Chicago.

Mira Mircheva told Bally’s she plans to leave her jobs as executive vice president and chief financial officer for personal reasons, according to the company’s Thursday announcement. Her resignation becomes effective September 4, but she will stay with the company until September 30 to assist during the handover.

President George Papanier will temporarily handle the CFO duties in addition to serving as Bally’s president and sitting on its board. Directors are already looking for someone to fill the finance position permanently.

The assignment puts a longtime gaming executive back into a familiar role. Papanier, who has more than four decades of industry experience, previously became Bally’s interim CFO in 2023. He is a certified public accountant and has overseen its land-based casino business since October 2021. Earlier, he spent February 2011 through October 2021 as Bally’s president and CEO.

“On behalf of the entire Board and executive management team, I want to thank Mira for her dedication to Bally’s and we wish her great success going forward,” said Robeson Reeves, Chief Executive Officer of Bally’s Corporation. 

“Having spent more than two decades in key operating and financial leadership roles at Bally’s, George has been instrumental in developing our business model, asset portfolio, and growth strategy. He steps into the interim role supported by an experienced finance organization and I am confident that our reporting, controls and capital markets work will continue without disruption.”

Papanier takes finance chief reins amid Bally’s multibillion-dollar casino expansion

The leadership switch comes at a time when Bally’s has several expensive casino developments underway and a complex financial position to manage.

For the fourth quarter of 2025, Bally’s preliminary results showed revenue reaching $746.2 million, a 28.6% increase from $580.4 million in the prior-year period. Casinos and resorts brought in $366.2 million during the quarter, with another $236.5 million coming from international online gaming.

Bally’s has grown through dealmaking as well. A transaction valued at roughly $3 billion combined its International Interactive operation with Intralot, giving Bally’s a controlling 58% interest in Bally’s Intralot.

Big construction commitments are also demanding capital. Bally’s plans a $4 billion casino and entertainment development in the Bronx while building its $1.7 billion permanent casino in Chicago.

Chicago has brought fresh complications. In August, Bally’s said it was “resetting the pace” of some construction while challenging a potential expansion of video gambling terminals across the city.

The company contends that unrestricted VGT growth would run against promises in its Host Community Agreement and leave the casino facing added uncertainty. Bally’s said the slowdown could affect some of the 1,500 union tradespeople on the project, though it still expects the permanent casino to open in early 2027.

Earlier construction problems included debris reaching the Chicago River, use of an unauthorized waste hauler and engineering revisions that forced foundation changes and relocation of the hotel tower.

Papanier now takes responsibility for Bally’s finance organization through those challenges while the board searches for a permanent CFO.

Featured image: SCM.com via website

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Three members of Congress have renewed their pressure on FanDuel, saying the betting operator still has not explained how its VIP program handles customers who may be struggling with gambling problems.

Sen. Richard Blumenthal and Reps. Paul D. Tonko and Valerie P. Foushee wrote to FanDuel CEO Christian Genetski on Thursday (September 3), following an August 14 response from the company that they considered insufficient.

“We remain unconvinced that FanDuel is making an active effort to protect bettors from harmful gambling and instead appears to be promoting addiction,” the lawmakers wrote.

FanDuel now has until September 17 to answer eight questions the lawmakers say remain unresolved.

Their scrutiny began after reports about Terry Thompson, a FanDuel VIP customer who experienced severe financial hardship linked to gambling addiction. Lawmakers said his VIP manager repeatedly offered incentives designed to keep him betting, including a personalized video featuring Philadelphia Phillies star Bryce Harper.

Thompson eventually wagered $18.5 million and lost more than $1.5 million, according to the lawmakers. He also took multiple mortgages on his home and sold business shares to fund his gambling.

Harper has said he believed the video was a personal Cameo greeting and did not know FanDuel would use it for a gambling promotion.

FanDuel VIP program faces scrutiny as MLB union backs restrictions

Congress is now asking FanDuel to explain what checks it makes before encouraging VIP customers to spend more, including whether it considers signs of financial hardship or gambling addiction.

The lawmakers also want figures showing how often customers who tried to reduce their betting or close accounts were offered exclusive benefits instead. They are asking whether losing streaks or reduced wagering can trigger targeted promotions, and how FanDuel supervises conversations between VIP managers and bettors.

Personalized celebrity messages are another focus. Congress wants to know how often athletes or other celebrities have appeared in videos sent to VIP customers to encourage continued gambling, and whether those celebrities understood how the messages would be used.

The dispute has also reached Major League Baseball’s labor talks. On August 24, the MLB Players Association said it was prepared to support collective bargaining restrictions preventing players from participating in personalized sportsbook marketing connected to VIP or tier programs. The union also wants broader limits on certain in-game proposition bets.

Blumenthal has separately pressed MLB, the NFL, NBA, NHL and NCAA for more information about their relationships with sportsbooks and prediction markets, citing concerns about addiction, integrity and athlete safety.

FanDuel’s push notifications and personalized promotions also drew criticism in the latest letter, alongside questions about its FanDuel Predicts prediction markets app.

“FanDuel’s so-called ‘commitment’ to its customers rings especially hollow when it is pushing out harmful and addictive features such as VIP perks, constant push notifications, and personalized promotions,” they wrote.

The lawmakers ultimately asked whether FanDuel would suspend or end the VIP program altogether.

“If FanDuel truly cared about its customers, it would be transparent to Congress about its business practices and put an end to these exploitative tactics,” they wrote.

Featured image: FanDuel / Canva

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The NFL is again asking designated contract markets to pull several types of football-related prediction contracts, making another push as the 2026 season gets underway.

A September 3 letter says exchanges are still listing contracts the league flagged in an earlier March 29 request. NFL officials argue those markets could undermine game integrity while exposing players, coaches, officials and exchange participants to additional risks.

“It is deeply concerning that bets within the objectionable categories that we identified months ago have been and continue to be listed as contracts on exchanges,” the NFL said in the letter, first reported by Front Office Sports.

Four groups of contracts are targeted: outcomes that one person could readily manipulate, subjects the NFL considers inherently objectionable, officiating-related markets and contracts based on information available before the public knows it.

The NFL pointed out proposed Commodity Futures Trading Commission rulemaking that discussed sports exchanges consulting governing bodies before listing event contracts.

At the same time, the league continues working with conventional sportsbooks. DraftKings, FanDuel and Fanatics Betting and Gaming are its three official sports betting partners for 2026. Their agreements require compliance with NFL integrity policies, including restrictions covering the same types of wagers the league is challenging on prediction exchanges.

The NFL has drawn another distinction through advertising. For the February 2026 Super Bowl, prediction market commercials were placed among prohibited advertising categories, even as a limited number of traditional gambling commercials remained permitted.

NFL says prediction markets lack sportsbook safeguards

Among contracts the league considers easily manipulated are whether a kicker misses a field goal, a quarterback throws an incomplete first pass or a receiver fails to catch a first target. First-rush yardage markets also made the list.

The NFL additionally wants exchanges to avoid contracts involving broadcast mentions, celebrity or fan attendance, player injuries, participation, misconduct and fan safety.

Its objections extend to officiating, covering penalty timing and totals, penalty types, replay decisions, other officiating actions and referee assignments.

Another category involves outcomes insiders could potentially know beforehand. Examples include a game’s first play, roster moves, signings, trades, personnel decisions, coaching choices, hiring and firing decisions, and live pick-by-pick draft contracts.

The league says exchanges should put more weight on its assessment of those risks.

“The DCMs must defer to the expertise of the sports leagues to protect the integrity of our games,” the letter said.

Chief Compliance Officer Sabrina Perel ended the letter with a warning about allowing the disputed contracts to remain available.

“Continuing to list these objectionable contracts threatens the underlying integrity of our games and creates significant risks for our players, coaches, and officials, as well as for those participating on your exchanges,” Perel wrote. “It is imperative that DCMs take further action to remove any objectionable bets. We appreciate your immediate attention to this matter.”

Featured image: Canva

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Prospect Park Councilman Anand Shah has resigned after roughly a decade in public office, months after admitting his role in an illegal gambling operation investigated by state authorities.

His resignation became effective August 28, 2026. Shah disclosed the decision in a letter addressed to the municipal clerk and shared publicly on Facebook.

“Writing this letter is one of the most difficult things I have ever had to do,” Shah wrote. “After approximately ten years of having the honor and privilege of serving the residents of Prospect Park, circumstances in my personal life now require me to step away from public office.”

The resignation arrives after Shah was handed down a ten year prison sentence. He was arrested in April 2025 and later indicted on 18 charges tied to allegations of illegal gambling, including racketeering, money laundering, official misconduct, extortion and tampering with public records.

After initially maintaining his innocence, he admitted his role in the illegal gambling operation, according to the New Jersey Attorney General’s Office.

“Public officials have a special duty to ensure that they follow the law,” said Attorney General Jennifer Davenport. “The defendant not only broke the law, but he then used criminal proceeds to fund his political campaign. Today’s guilty plea demonstrates that no one is above the law.”

Anand Shah resigns after admitting role in illegal gambling operation

The case grew out of a broader state investigation into an alleged gambling and money-laundering enterprise involving unlicensed poker games and sports betting. Shah had been among dozens of defendants charged in the investigation.

Prosecutors initially charged Shah with allegations that included racketeering, money laundering, official misconduct, extortion and tampering with public records. He spent about seven weeks in the Morris County jail following his April 2025 arrest before being released.

Earlier in the case, Shah’s attorney, Michael P. DeMarco, said Shah planned to “vigorously defend against the State’s charges” and clear his name and reputation.

Shah did not directly discuss the criminal case in his resignation letter. Instead, he referred more broadly to the circumstances that prompted him to leave office and apologized to those he disappointed.

“This is not the way I ever imagined my years of public service would come to an end,” Shah wrote. “Nevertheless, I recognize that circumstances in my life now require my full attention and make it necessary for me to resign from elected office.”

He added: “To anyone whom I have disappointed, I offer my sincere apology. I accept responsibility for the circumstances that have brought me to this point in my life.”

Shah said he intended to approach what comes next with “humility, reflection, accountability, and a commitment to becoming a better person.”

The remainder of his letter largely looked back at his time in municipal government. Shah thanked residents, colleagues, employees, first responders, volunteers and community leaders while reflecting on what his years in office meant to him.

“For the past decade, serving the people of Prospect Park has been far more than simply holding an elected position,” Shah wrote. “It has been an important part of my life, and it has been a responsibility that I have always taken seriously.”

“I will remember the people,” Shah wrote, recalling conversations with residents, community events, efforts to assist constituents and support for local children, schools, employees and volunteers.

He also thanked voters for repeatedly putting their confidence in him.

“Being given the opportunity to represent my neighbors and community for approximately ten years is something I will never take for granted,” he wrote.

Shah said he hoped the circumstances surrounding his departure would not overshadow his record on the council.

“I hope that my current circumstances will not erase the genuine dedication, time, and effort that I gave to Prospect Park throughout approximately ten years of public service,” he wrote. “I am proud of the good that was accomplished during my time on the Council.”

“It has truly been an honor and privilege to serve the Borough of Prospect Park and its residents for approximately ten years,” Shah wrote. “I will carry the memories, relationships, lessons, and experiences of these years with me for the rest of my life.”

Featured image: Anand Shah via Facebook

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A Michigan judge has temporarily shut Kalshi’s sports contracts out of the state, handing Attorney General Dana Nessel a preliminary injunction while her lawsuit against the prediction-market company moves forward.

Ingham County Circuit Court Judge Rosemarie E. Aquilina signed the order September 1, barring Kalshi and related parties from activities tied to sports wagering in Michigan until the court issues a final order.

Aquilina found Michigan had satisfied the legal requirements for preliminary relief. The order said, “Michigan and its most vulnerable citizens are suffering and will continue to suffer immediate and irreparable harm absent relief from being exploited by Kalshi’s sports betting operation masquerading as an investment opportunity.”

“Kalshi long attempted to pass itself off as a legitimate gaming operation in our state, and I am relieved that this order further protects Michigan residents from its predatory, unlicensed practices,” said Attorney General Nessel in an accompanying statement. “My office will continue to defend Michiganders and enforce our gaming laws, which ensure gambling revenue is regulated and distributed back into our communities.”

Kalshi faces Michigan sports betting ban and steep noncompliance fines

Nessel brought the case in March, arguing Kalshi effectively runs an unlicensed sportsbook by letting Michigan customers trade event contracts tied to sports results without Michigan Gaming Control Board approval. Examples previously cited by the state covered hockey, golf and basketball, along with totals, spreads and other sports outcomes.

Kalshi tried moving the dispute into federal court, but the case was returned to Ingham County. The jurisdictional fight reflects a wider disagreement over prediction markets: Kalshi considers its contracts federally regulated financial products, while Michigan says sports contracts fall under state gambling laws.

The injunction blocks contracts functioning as internet sports betting, including parlays, moneylines, over-unders, pools, proposition bets and in-game wagers. Kalshi also cannot collect related deposits or fees or promote those products to Michigan residents.

Age rules were another concern for Aquilina. “Michigan’s legalized gaming industry requires those who wish to place wagers to be 21 years of age or older,” the order states. “Kalshi, however, allows people to place wagers beginning at age 18.”

The court also cited lost public revenue, stating that “Kalshi is undercutting Michigan’s funding for schools, compulsive gambling prevention, economic development, and first responders.” Detroit and tribal governments could also lose revenue, according to the order.

Kalshi must now use a third-party geolocation provider licensed by Michigan regulators and capable of meeting state geofencing standards. Noncompliance carries a steep potential penalty. The order says Kalshi “shall pay a fine of $500,000 per day for each day that the Court finds Kalshi did not comply with the geolocation requirements of this order.”

The company must also distribute the injunction to Futures Commission Merchants offering its sports event contracts within three business days.

The ruling follows a June temporary restraining order and another regulatory clash in July, when the Commodity Futures Trading Commission directed Kalshi to restore Michigan trades it had unwound following a state court order. Kalshi said that federal action left it caught between conflicting state and federal requirements.

Featured image: Canva / Kalshi

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New Jersey is taking its fight with Kalshi to the US Supreme Court, asking the justices to decide whether federally regulated prediction markets must also follow state sports betting rules.

The state has petitioned for review after a divided Third Circuit prevented New Jersey from enforcing its wagering laws against KalshiEX LLC. At issue is whether Dodd-Frank blocks states from regulating sports contracts offered through Commodity Futures Trading Commission-regulated markets.

“For more than a century, the States have been the primary regulators of gambling in this country,” New Jersey said in its petition. It also cited the Supreme Court’s 2018 Murphy v. NCAA ruling, where the justices said “each State is free to act on its own” when regulating sports betting.

Kalshi added sports event contracts in January 2025, letting customers buy “yes” or “no” positions on outcomes ranging from tournament winners to player performances.

New Jersey’s Division of Gaming Enforcement responded with a cease-and-desist letter in March 2025. The regulator also targeted Robinhood, alleging both companies offered unauthorized sports wagering. It reportedly demanded that wagers from New Jersey residents be voided and specifically raised the state’s restrictions involving local college teams and events.

Kalshi then went to federal court. A district judge blocked enforcement, and the Third Circuit later agreed that qualifying contracts were swaps covered by the CFTC’s exclusive authority. During appellate arguments, judges had questioned New Jersey’s position while noting the federal definition of swaps was broad.

Supreme Court New Jersey petition follows conflicting rulings over state gambling authority in Kalshi cases

The legal landscape changed on August 28, when the Ninth Circuit reached the opposite conclusion in Kalshi v. Assad.

According to New Jersey’s petition, the Ninth Circuit said Kalshi’s offerings are “sports gambling, regardless of whether Kalshi calls them swaps.” The court also said that “The Dodd-Frank Wall Street Reform Act cannot be read as a direct (or indirect) regulation of sports gambling.”

That ruling allowed Nevada to enforce its gambling laws while litigation continues and concluded Kalshi was unlikely to succeed on its federal preemption arguments. The Ninth Circuit also emphasized that Kalshi self-certified its sports contracts rather than receiving affirmative CFTC approval.

New Jersey says the conflicting appellate decisions now affect a much broader legal battle, pointing to at least 39 lawsuits across 20 states.

Kalshi defended the rulings it won in New Jersey.

“We disagree with New Jersey’s filing. Kalshi is an open, nationwide financial exchange. It cannot be regulated by 50 different regulators,” said Kalshi spokesperson Dani Lever. 

“Both the Third Circuit and the District of New Jersey sided with Kalshi because the CFTC’s exclusive jurisdiction preempts state law. While New Jersey points to a recent decision in the Ninth Circuit, that decision agreed with that key principle. Where it differed, it did so based on a regulation that’s in the process of being rewritten. We remain confident in the lower courts’ rulings, and nothing in New Jersey’s filing today changes our view.”

With federal appeals courts now divided, New Jersey wants the justices to resolve who controls these sports markets. “This Court should grant certiorari,” the state said.

Featured image: Canva

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Churchill Downs Incorporated has asked the Federal Trade Commission (FTC) to order an independent review of the Horseracing Integrity and Safety Authority, escalating scrutiny of the regulator days before HISA provisionally suspended trainer Angel Quiroz over a series of alleged medication and horse-welfare violations.

In an August 28 letter to FTC Chairman Andrew Ferguson and Commissioner Mark Meador, Churchill Downs said a series of recent events had raised “significant questions about the governance, transparency, technology controls, and accountability” of HISA. The company asked the FTC, which oversees HISA, to require or initiate a formal independent review covering racing and wagering integrity, non-public information and the safeguarding of sensitive industry data.

The intervention follows controversy over the so-called “Fair Hill Five” betting episode and HISA’s handling of confidential veterinary information accessed through its online portal by horse racing data analyst and owner Marshall Gramm.

The latest enforcement action came on August 31, when HISA served Quiroz with a notice alleging violations of Rules 2215 and 2221. His registration was provisionally suspended from noon EDT on September 1, pending a provisional hearing. The notice says HISA believed there was “clear and convincing evidence” that his actions or inactions presented an immediate threat of serious injury or death to covered horses or riders.

HISA alleges three horses under Quiroz’s care, Bonita Rough, Scootaloo and Tepeyac, returned adverse analytical findings for Albuterol, which is classified as a banned substance unless prescribed in specified circumstances. Each alleged anti-doping violation involving a banned substance carries a potential two-year period of ineligibility and $25,000 fine.

Quiroz suspended after three horses test positive for Albuterol

The first case involved Bonita Rough, whose blood sample was collected after a Vet’s List Workout at Fair Hill Training Center in Maryland on July 10.

According to the notice, laboratory analysis detected Albuterol, while HISA Portal records showed no dispensation, prescription or treatment with the drug during the period Quiroz was the horse’s Responsible Person.

HISA’s filing says Quiroz subsequently told investigators he had nebulised Bonita Rough with Albuterol obtained from the horse’s veterinarian at Gulfstream.

“You stated that you nebulized Bonita Rough with Albuterol that you received from Bonita Rough’s Veterinarian at Gulfstream,” the charge letter quoted in the notice says. “You stated the Veterinarian had prescribed the medication to another horse but informed you that you could use it on Bonita Rough if needed.”

HISA alleges that this amounted to administering a controlled medication outside a valid veterinarian-client-patient relationship. Its notice also says no corresponding Albuterol treatment records existed in the HISA Portal for Bonita Rough, Scootaloo or Tepeyac.

The regulator said Quiroz was notified of the potential Bonita Rough violation on July 28. Thirteen days later, an out-of-competition sample was collected from Scootaloo at Saratoga Race Course and subsequently tested positive for Albuterol, according to the notice.

A sample taken from Tepeyac at Fair Hill on August 13, 16 days after the initial notification concerning Bonita Rough, also returned an adverse analytical finding for Albuterol, HISA said.

HISA said the alleged discovery of banned substances in multiple horses after Quiroz had already been notified of the first case posed an “immediate threat of serious injury or death to Covered Horses or Riders”. The allegations remain subject to the disciplinary process.

Quiroz also faces a separate allegation that he caused Bonita Rough to breach her provisional suspension by posting a timed and reported workout at Fair Hill on July 29.

Churchill Downs says HISA scrutiny goes beyond Gramm

The Quiroz action comes as Churchill Downs is challenging HISA over broader questions about its technology, oversight and disclosure practices.

Its August 28 FTC letter focused heavily on the controversy surrounding Gramm’s access to confidential veterinary and horse-health information through the HISA Portal.

HISA announced on August 17 that it had charged Gramm with multiple rule violations, including fraud, after an investigation into confidential information appearing in past-performance reports for Deterministic and Griffin’s Wharf. HISA said the information should only have been available to the horses’ connections and regulatory veterinarians.

HISA said its investigation, which included an independent forensic cybersecurity analysis, concluded Gramm had deliberately accessed confidential information over approximately six weeks and developed an automated method for obtaining it “at scale” in a way designed to mimic authorized activity and avoid detection.

Gramm has disputed HISA’s characterisation of his conduct. In a public statement, he said the information was available through his authorised HISA account and that he used his own credentials, did not conceal his identity and bypassed no security protocols or safeguards.

“I intend to vigorously defend myself in the HISA proceedings,” Gramm said.

He acknowledged exercising “poor judgment” by failing to alert HISA sooner to the vulnerability after the issue became public, but argued that focusing on him distracted from weaknesses in HISA’s systems.

The Jockey Club separately said Gramm had accessed veterinary information relating to horses he did not own and announced that its stewards would meet to take steps to remove him as a member.

Portal controversy raises questions over HISA security controls

Churchill Downs told the FTC it was not seeking to “excuse, minimize, or prejudge” any alleged misconduct by Gramm. Instead, it argued that the controversy exposed a separate institutional problem.

“But the institutional question is separate and more fundamental: why was such information accessible in the first place?” the company said.

The company stressed what it characterized as a reversal in HISA’s public explanation of the episode. According to the letter, HISA CEO Lisa Lazarus had initially said screenshots circulating online could not have originated from the HISA Portal, before HISA later acknowledged the health information had come from its system.

Churchill Downs said HISA’s subsequent focus on allegations of “fraud”, “misappropriation” and other wrongdoing by Gramm did not answer critical questions about the regulator’s own controls.

Among them were how an authorised user could access records for horses with which they had no legitimate connection, whether similar vulnerabilities existed elsewhere, whether other users accessed comparable information, how long the vulnerability existed and why it was not detected sooner.

HISA, meanwhile, said it had changed its technology systems to prevent similar unauthorised access and was devoting additional resources to protecting confidential information.

“There must be significant consequences for individuals who violate the integrity of our rules and obtain and abuse confidential horse health information,” Lazarus said. “HISA will take every necessary step to fiercely protect the integrity of Thoroughbred racing and ensure that violators of our rules are punished appropriately.”

Churchill Downs seeks independent review of HISA governance

Churchill Downs wants the FTC review to extend well beyond the Gramm case.

Its letter calls for an independent examination of the Fair Hill Five episode, the timing and disclosure of a previously undisclosed banned-substance positive connected with the matter, the HISA Portal vulnerability, whether other users downloaded or shared confidential information, and HISA’s relationships with technology providers.

The company also questioned whether HISA’s procurement, vendor oversight and information-security governance were appropriate for an organisation exercising federally authorised regulatory powers.

“HISA’s legitimacy depends on confidence that it is transparent, accountable, technologically competent, and subject to meaningful oversight,” Churchill Downs said.

It added that restoring confidence would require more than assurances that individual wrongdoers would be punished.

“It will require an independent accounting of what happened, why it happened, whether it could happen again, and whether HISA’s governance and technology infrastructure are adequate for the responsibilities it has been given,” the company said.

HISA’s own materials state that it operates under FTC oversight and that its national racing integrity framework is subject to federal review.

Featured image: HISA via press release

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FanDuel has voided wagers placed on behalf of Bill Simmons and taken action against his account after the sports media personality admitted using his daughter’s boyfriend to make bets for him in Massachusetts.

The sportsbook said it also reported the matter to the Massachusetts Gaming Commission (MGC), which is reviewing Simmons’ admission.

“We became aware of the issue and handled it consistent with our Terms and Conditions and Massachusetts Gaming Commission regulations, including reporting the matter to the MGC, voiding the bets, and actioning the account,” a FanDuel spokesperson said.

FanDuel did not disclose what action it had taken against Simmons’ account. Its terms prohibit customers from allowing other people to access their accounts or wager on their behalf, a practice known as proxy betting. 

The incident is also being examined by Massachusetts regulators.

“The Commission is aware of the comments made on the Bill Simmons Podcast and staff are currently reviewing the matter,” MGC spokesman Thomas Mills told Front Office Sports. 

The Simmons case comes as the MGC is already examining sportsbook VIP programs following a separate FanDuel controversy involving Philadelphia Phillies star Bryce Harper. Harper said a personalised Cameo video he recorded as a holiday greeting was later branded and used by FanDuel as a gambling promotion without his knowledge or consent. 

The MGC said in July that it was aware of the case and was looking into VIP programs “as a whole,” with an update potentially reaching its agenda this fall.

Simmons admits sharing FanDuel login to place bets remotely

Simmons, founder of The Ringer and a former ESPN columnist, disclosed the arrangement while discussing bets he wanted to make from Los Angeles, where online sports betting is not legal.

He explained that his daughter and her boyfriend, Hank, had both recently turned 21 and that Hank was in Massachusetts, where FanDuel operates.

“There was a couple of bets I really wanted to get in,” Simmons said, mentioning UCLA and Houston before describing how he provided access to his account.

“I let Hank log into my FanDuel as me. I get the code to make sure it’s me to my phone, I give him the code, he logs in,” Simmons said.

Simmons said money from successful futures bets the previous year remained in the account and Hank used it to place wagers on his behalf.

“And he’s putting in bets for me, and honestly, it was the closest I’ve ever felt to Hank,” Simmons joked. “It was a real bonding moment for us.”

The arrangement was not limited to one occasion. Simmons said that a week later he contacted Hank again and “we did some more.”

His description amounts to proxy betting, which Massachusetts rules require licensed sportsbooks to prevent. FanDuel’s own terms similarly state that accounts are for personal use and prohibit allowing another person to log in to place a wager on the account holder’s behalf. 

FanDuel voids wagers and reports Simmons to regulator

Simmons’ comments quickly attracted regulatory scrutiny, particularly because he described not only having another person place the wagers but also sharing the authentication code sent to his phone.

Massachusetts law requires sports wagering operators to prevent people from placing wagers as agents or proxies for others. State regulations also provide mechanisms for cancelling wagers involving prohibited bettors.

FanDuel subsequently confirmed that it had reported the matter to the MGC, voided the affected bets and taken action against Simmons’ account.

The case has an additional commercial dimension because FanDuel is The Ringer’s exclusive sports betting partner.

Neither FanDuel nor the MGC has publicly detailed what further consequences, if any, Simmons could face. The commission said only that its staff were reviewing the matter.

Simmons says he misunderstood proxy betting rules

Simmons addressed the controversy again on his podcast after FanDuel acted, saying he had not realised the arrangement violated proxy betting rules.

“I talked about how I got my daughter’s boyfriend to place some bets for me in Massachusetts, because I was in LA,” Simmons said.

“Did not know about the proxy rules. Yeah, there’s some real rules with this stuff,” he added.

Simmons confirmed that the wagers had been voided and said he had learned from the episode.

“Apparently, proxy betting not allowed. I actually thought it was, but that’s fine.”

He continued to joke about the involvement of his daughter’s boyfriend, before acknowledging the consequence for his wagers.

“All those bets went out the window. All that special time I had with Hank, out the window as well.”

Simmons said he expected to be back in Boston and could place wagers himself in the future, concluding: “Lesson learned.” 

The MGC has not yet announced the outcome of its review. 

Featured image: Bill Simmons via BeyondAvgMick on X

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Today in prediction market news, we’re following a fresh wave of legal and regulatory developments, including Kalshi urging the Tenth Circuit to block Utah enforcement while its federal appeal plays out, and Ohio and Rhode Island pointing to recent Ninth Circuit rulings as they defend state authority over prediction markets.

We’re also tracking Kalshi’s permanent ban of former Republican New York Congressman George Santos following an investigation into his trading activity, along with the platform’s call for clearer CFTC guardrails as event contract markets grow.

We’ll also be following the latest on enforcement actions involving political trading, Kalshi’s allegations against North Carolina congressional candidate Laurie Buckhout, and developments across prediction markets, regulation, politics, crypto and sports event trading throughout the day.

The post States cite Ninth Circuit rulings, George Santos banned from Kalshi: today in prediction market news LIVE appeared first on ReadWrite.

The Ninth Circuit has called Kalshi’s contracts what its advertising already did: sports betting. 

Kalshi’s marketing department wrote the opening line of its own legal defeat.

“KalshiEX, LLC advertises itself as ‘the first app for legal sports betting in all 50 states’,” Judge Ryan Nelson wrote in the first sentence of the Ninth Circuit’s 50-page opinion.

It appears to be a rough way to learn that ad copy can become evidence.

Kalshi has spent much of its legal battle arguing that its sports contracts are not sports bets but financial derivatives traded on a federally regulated exchange. The court noticed the slight branding inconsistency.

A unanimous three-judge panel ruled on Friday that Kalshi’s sports event contracts are, in substance, sports bets. Because those bets are not “swaps” within the meaning of the Commodity Exchange Act, they do not fall within the Commodity Futures Trading Commission’s exclusive jurisdiction. Nevada can therefore apply its gaming laws.

Calling a wager an event contract, the court effectively concluded, does not make it any less of a wager. Or, as Nelson put it with an unexpected assist from Shakespeare, “placing sports bets, even when called by another name, is still gambling”.

The ruling threatens the premise that allowed Kalshi to offer sports markets nationwide without collecting state gambling licences like particularly difficult Pokémon.

It also creates a direct split with the Third Circuit, which sided with Kalshi against New Jersey in April. In that court, a sports result could qualify as an event associated with an economic consequence and therefore support a federally regulated swap. In the Ninth Circuit, a parlay remains a parlay even if it arrives wearing a derivatives badge.

The Supreme Court may eventually have to decide which version of reality applies.

Nevada can enforce its gambling laws while litigation continues

Technically, the Ninth Circuit has not issued a final judgment on whether Kalshi’s entire business is lawful.

The case concerns a preliminary injunction. Kalshi wanted the courts to stop Nevada enforcing its gambling laws while the litigation proceeded. The panel upheld the decision to dissolve that protection because Kalshi had not shown that it was likely to win its federal pre-emption arguments.

While the distinction matters legally, commercially, it offers limited comfort.

The opinion devotes dozens of pages to explaining why Kalshi’s sports contracts probably are not swaps, why federal law probably does not displace Nevada’s gambling laws and why the company’s contracts appear to violate an existing CFTC rule.

This is not a court politely reserving judgment. It is a court explaining, at considerable length, why it does not believe the pitch.

The decision is now binding precedent within the Ninth Circuit, which covers Alaska, Arizona, California, Hawaii, Idaho, Montana, Nevada, Oregon and Washington, along with US Pacific territories.

That includes California, the largest state without legal sports betting and a prize market for any operator claiming to offer it legally anyway.

Trading against other users does not make a sports bet a swap

Kalshi’s legal distinction is not entirely frivolous.

Traditional sportsbooks generally set odds and take the other side of customers’ bets. Kalshi operates a designated contract market where users trade positions with one another and prices move according to supply and demand.

Brian Quintenz, a Kalshi board member and former CFTC commissioner, told Bloomberg that the ruling had created “more confusion than clarity.” He argued that betting against a house is fundamentally different from trading with other market participants.

Quintenz also said the Commodity Exchange Act was deliberately written to allow derivatives based on events carrying “any financial, commercial or economic consequence,” because those contracts can assist with risk management and price discovery.

The Ninth Circuit’s answer was essentially: nice exchange, still a bet.

The court compared someone wagering at Caesars that the Las Vegas Raiders would win by more than 7.5 points with someone buying a Kalshi contract that pays out if the Raiders win by more than 7.5 points.

Different plumbing, same football game, same uncertain outcome and same prospect of losing the money.

“For Kalshi to deny that its sports event contracts are sports bets under a reasonable person’s understanding is disingenuous,” Nelson wrote.

The company’s offerings included game winners, point spreads, individual player propositions and multi-leg combinations. The latter are functionally parlays, one of the most recognizable and lucrative sportsbook products.

Kalshi may describe users as traders, positions as contracts and odds as prices. The court looked past the vocabulary and concentrated on what customers were doing with their money.

This substance-over-label approach is the ruling’s most important feature. Registering an exchange with the CFTC does not automatically place every product listed on that exchange beyond state control. The product must first be something over which Congress gave the CFTC exclusive jurisdiction.

For sports contracts, the Ninth Circuit said Kalshi had failed that qualifying round.

Self-certification gave Kalshi no federal approval

There is another awkward fact for Kalshi. The CFTC never approved these sports contracts.

Kalshi listed them through self-certification. This allows a registered exchange to tell the CFTC that a new contract complies with federal law and commission rules, then begin offering it without waiting for an affirmative approval order.

Self-certification is useful, but it is not a federal blessing delivered on official stationery.

The Ninth Circuit stressed that the CFTC never placed Kalshi’s sports contracts into a 90-day review process and never issued an order approving them.

Meanwhile, the current version of CFTC Rule 40.11 says registered exchanges “shall not” list certain contracts involving, relating to or referencing gaming. The court interpreted “shall not” using its traditional legal meaning of “do not do this”.

It therefore concluded that Kalshi’s listing of sports contracts was itself unlawful under the existing rule.

The CFTC has proposed rewriting Rule 40.11 to create a contract-by-contract review framework. But proposed regulations have no legal effect, however promising their press releases may sound. Until the rewrite becomes final, the existing prohibition remains in place.

This leaves Kalshi in the unusual position of claiming exclusive protection from a federal regulator whose current rule appears to prohibit the product requiring protection.

Even a completed rewrite may not resolve the deeper problem. Agencies can change regulations, but they cannot grant themselves powers that Congress withheld. If sports contracts are not swaps, the CFTC cannot make them swaps simply by becoming more enthusiastic about prediction markets.

The Ninth Circuit ruling threatens the markets generating almost all revenue for Kalshi

Losing sports would not be a minor product adjustment for Kalshi.

According to the Ninth Circuit, sports accounted for more than 90 per cent of Kalshi’s trades in 2025 and 95 per cent of its revenue.

Election contracts made prediction markets famous. Sports contracts paid the bills.

The court sent the dispute over election markets back to the Nevada district court because their status had not been properly analysed. Election trading therefore remains undecided.

That means the product for which Kalshi is best known survives for another round. The product responsible for almost all its revenue has just taken the loss.

If the Ninth Circuit’s reasoning spreads, Kalshi may have to block sports trading in states that take enforcement action. It could seek state licences, but the suggestion that it merely needs “50 licences” makes the process sound far more convenient than it is.

Some states do not permit sports betting at all. Others limit licences to casinos, tribal operators, lotteries or their selected partners. Each jurisdiction can impose its own rules on age limits, taxes, advertising, college sports, bet types and responsible gambling.

California, for example, does not have a licence sitting behind a counter waiting for Kalshi to fill in a form.

State-by-state compliance would also damage the national liquidity that makes an exchange model attractive. A contract available in New Jersey but unavailable in Nevada, California or Washington is no longer one seamless national market.

Kalshi could end up operating less like the New York Stock Exchange and more like a collection of regional betting shops that happen to share an app.

Under-21 sports trading strengthens the case for state intervention

The legal question has also become entangled with the rather less theoretical subject of young adults betting billions on sport.

CNN estimated that Kalshi users aged 18 to 20 traded approximately $5.4 billion during 2026, including about $3.9 billion on sports and parlays. Kalshi said that age group represented only 3.14 per cent of its total volume, which reached approximately $173 billion.

Both figures can be true. Neither makes the issue disappear.

Financial exchanges generally admit customers from 18, while most state-regulated sportsbooks impose a minimum age of 21. From Kalshi’s perspective, that is the rule applying to its federally regulated market. From the states’ perspective, it looks remarkably like teenagers and young adults accessing sportsbook products through a financial-market loophole.

Add parlays, mobile advertising and the start of the NFL season, and regulators do not have to work especially hard to make the issue politically appealing.

The Ninth Circuit has now given them a strong legal argument as well. Regulators can say that these are sports bets, that federal law does not displace their authority and that Kalshi must follow the same rules as locally licensed operators.

Once the product is legally classified as gambling, the consequences extend far beyond licensing. State rules governing minimum ages, prohibited markets, consumer protection, problem-gambling measures and taxation all come back into play.

Conflicting appellate rulings leave Kalshi operating under two legal realities

The Third and Ninth Circuits reached opposite results largely because they read the same words at different levels of literalism.

The Commodity Exchange Act defines certain swaps by reference to an event or contingency associated with a potential financial, economic or commercial consequence.

The Third Circuit reasoned that a sporting result can fit those words. People trade contracts on an event, money changes hands and the event therefore has an economic consequence.

The Ninth Circuit looked at the wider statutory context. Dodd-Frank was a response to a financial crisis, not a stealth attempt to appoint the CFTC commissioner of every point spread in America.

Congress has repeatedly legislated specifically about gambling, sports betting and tribal gaming. The panel found it implausible that lawmakers quietly transferred nationwide sports-gambling authority to the CFTC through broad language in a Wall Street reform statute.

“The CFTC is not a national gambling regulator,” Nelson wrote. “No one suggested it was until over a decade after the law was passed.”

The court also invoked the major-questions doctrine, under which judges expect clear congressional authorisation before agencies assume powers of vast economic and political significance.

Reading “event” broadly enough to federalise a multibillion-dollar industry traditionally overseen by states and tribes, the panel concluded, would be an elephant in a mousehole.

Or perhaps, in this case, an entire sportsbook in a footnote.

The circuit split increases pressure for Supreme Court review

The circuit split makes Supreme Court review more likely.

Kalshi can first ask the Ninth Circuit panel to reconsider or seek rehearing before a larger en banc court. It can then petition the Supreme Court. The justices may choose to wait for more appellate decisions or for either case to reach a final judgment.

Waiting comes with costs, however. A nationwide online platform cannot easily operate under two incompatible definitions of its central product.

In the Third Circuit, Kalshi has preliminary protection against New Jersey enforcement. In the Ninth Circuit, Nevada can treat substantially identical contracts as unlicensed sports betting.

Similar cases are already moving through courts around the country. Nevada, Massachusetts, Michigan and Washington have obtained orders restricting Kalshi, while the CFTC has intervened against state regulatory action elsewhere.

The legal map is beginning to resemble one of the platform’s own markets, except nobody can agree on the resolution source.

Either outcome would remake the industry

If Kalshi ultimately wins, the consequences could extend well beyond prediction-market start-ups.

A Supreme Court ruling that sports event contracts are federally regulated swaps could remove qualifying products from state gaming control. Major sportsbook operators would have a strong incentive to acquire, partner with or establish CFTC-regulated exchanges.

Why maintain dozens of state licences if the same products can be offered nationally as derivatives?

States could lose licensing fees and gambling taxes. Tribal operators could see their negotiated exclusivity rights weakened. State restrictions on customer age, college betting, advertising and particular wager types might no longer apply to federally listed contracts.

Control would instead sit primarily with the CFTC. That may suit the industry while the commission is supportive, but regulators are not fixed features of the landscape. Administrations change, commissioners leave and political priorities reverse.

A single federal regulator is wonderfully efficient until it dislikes your product.

If Kalshi loses, state and tribal authority survives. But Kalshi’s nationwide sports model does not. The company would need licences or commercial partnerships wherever those routes exist, while withdrawing from jurisdictions where they do not.

The ruling could also encourage courts to stop treating “prediction markets” as one tidy product category. Contracts tied to inflation, interest rates, weather or commercial risks may look like conventional derivatives. Point spreads, parlays and player props look like something available at a sportsbook because they are something available at a sportsbook.

Awards, elections and political mention markets will occupy the uncomfortable territory in between.

The Ninth Circuit has not killed prediction markets. It has challenged the idea that attaching the word “market” to every prediction gives it federal immunity.

Kalshi still has several legal avenues and a supportive CFTC. But it now faces a judicial opinion that quotes its own sports-betting advertisement, compares its argument to hiding an elephant in a mousehole and uses Romeo and Juliet to explain why a bet remains a bet.

As appellate losses go, it was unusually well reviewed.

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Kalshi wants federal regulators to tackle manipulation in prediction markets by going after misconduct and restricting specific traders, rather than placing sweeping limits on event contracts.

In August 27 written comments, KalshiEX LLC responded to issues aired during the Commodity Futures Trading Commission’s inaugural Innovation Advisory Committee meeting on August 20.

The federally regulated exchange concentrated on manipulation, so-called mention markets and questions over whether event contracts connected to corporate results might come under securities rules.

Kalshi, founded in 2018 and designated by the CFTC as a contract market in November 2020, said regulators should treat manipulation much as they would on established exchanges.

“The existence of manipulation and similar trading misconduct on exchanges should lead us to work harder to root out that misconduct, not to ban or restrict legitimate trading on the platform,” Kalshi said.

CME Group’s Terry Duffy had questioned the rapid pace of event-contract self-certifications and warned that some products could be manipulated during the committee meeting.

Kalshi responded that prediction exchanges already face CFTC anti-manipulation requirements alongside surveillance, compliance and disciplinary obligations. The company said its own monitoring has identified suspicious activity for investigation and CFTC referral, while disciplinary cases have included trades valued below $100.

“The solution is to continue pursuing bad actors, not to close markets or delist contracts that innocent market participants, by their own revealed preferences, value and wish to trade,” the company said.

Kalshi favors targeted CFTC safeguards for manipulation risks

Another area drawing scrutiny is mention markets, which settle according to whether someone says a specified word or phrase during an event.

Robinhood’s Vlad Tenev told the committee that some of these contracts could invite manipulation and raise customer-protection concerns. Kalshi acknowledged those risks while opposing a blanket ban.

“Kalshi shares the view that the answer is robust guardrails rather than prohibition,” the company said.

Under Kalshi’s proposed approach, the person whose words determine settlement could not trade the contract. Speechwriters, communications staff, teleprompter operators, producers and others with advance knowledge would also be excluded.

Kalshi said those restrictions already apply through its rules, while screening tools introduced in June prevent known politicians, athletes and league-affiliated people from trading related markets. It wants the CFTC to set comparable minimum requirements across exchanges.

On corporate event contracts, Kalshi also rejected the idea that correlation with a company’s share price automatically makes a binary contract securities-based.

The exchange said these products differ from conventional options because there is no non-refundable premium or exercise right, with buyers and sellers instead taking symmetric risk.

Rather than assigning every crossover product to a single regulatory bucket, Kalshi wants the CFTC and Securities and Exchange Commission to leave exchanges flexibility when contracts touch both jurisdictions. Its broader argument is that federal oversight can cover these products without creating overlapping regulatory regimes.

Featured image: Canva

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