{"id":6302,"date":"2026-07-17T16:06:51","date_gmt":"2026-07-17T16:06:51","guid":{"rendered":"https:\/\/relocationtimess.com\/?p=6302"},"modified":"2026-07-17T16:06:51","modified_gmt":"2026-07-17T16:06:51","slug":"trump-regulator-orders-kalshi-to-defy-michigan-court-escalating-battle-over-prediction-markets","status":"publish","type":"post","link":"https:\/\/relocationtimess.com\/?p=6302","title":{"rendered":"Trump regulator orders Kalshi to defy Michigan court \u2013 escalating battle over prediction markets"},"content":{"rendered":"
\n
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\n The Trump administration took an extraordinary step this week to escalate its nationwide efforts to prevent states from regulating prediction markets, where users can trade on real-world events like sports, politics and pop culture.\n <\/p>\n

Read more Barack Obama hasn\u2019t endorsed a Michigan Senate candidate. An AIPAC-linked group is spending millions on ads with him anyway<\/a><\/p>\n

\n The Commodity Futures Trading Commission, the federal agency that regulates prediction markets, directed Kalshi not to cancel pending sports trades in Michigan, in defiance of a court order from a state judge.\n <\/p>\n

\n The rare CFTC order cited emergency powers that haven\u2019t been invoked since President Jimmy Carter\u2019s grain embargo against the Soviet Union during the Cold War.\n <\/p>\n

\n Kalshi said it had already complied with the judge\u2019s order, and the volume of unwound trades was relatively small \u2013 which means the legal standoff might be moot for now. But this maneuver was the CFTC\u2019s most aggressive and surprising step yet in its efforts to stop states from reigning in prediction markets.\n <\/p>\n

\n \u201cThis hasn\u2019t happened in 46 years,\u201d said Robert Schwartz, the agency\u2019s former general counsel, of the CFTC using its emergency authorities. \u201cAnd it\u2019s an assertion of federal power in financial markets like we haven\u2019t seen so far, by countermanding a court order.\u201d\n <\/p>\n

\n With the backing of President Donald Trump, the CFTC has embraced prediction markets, which have exploded in popularity this year. The CFTC\u2019s move comes after it filed lawsuits against states that tried to regulate the companies, and withdrew Biden-era proposals to ban some types of trades.\n <\/p>\n

\n Trump and his family have financial ties to the prediction market industry. And he has reshaped the CFTC by leaving his sole appointee, Michael Selig, at the helm of the five-member commission.\n <\/p>\n

\n While Selig has largely been in lockstep with the industry, the unorthodox intervention in Michigan created some rare daylight between the two sides. It caught many in the industry off guard, rattled seasoned traders by creating uncertainty about pending trades and drew condemnation from Kalshi.\n <\/p>\n

\n Kalshi\u2019s head of enforcement, Bobby DeNault, said: \u201cWe are disappointed by this decision and believe it is unfair to Kalshi,\u201d in an X post Tuesday night.\n <\/p>\n

\n \u201cWe are being put in an impossible position, looking to follow state court orders that may contradict our federal regulatory obligations,\u201d DeNault wrote.\n <\/p>\n

\n A source familiar with the CFTC\u2019s decision-making told CNN this was doneit issued the directive to stop what it sees as a bad precedent from influencing ongoing lawsuits in other states. The source said, \u201cthis isn\u2019t about Kalshi and it certainly wasn\u2019t to help them,\u201d adding that, \u201cit makes their life harder, in this case.\u201d\n <\/p>\n

\n Separately, CNN reported Thursday that the CFTC is investigating a White House teleprompter operator for potential insider trading on markets about Trump\u2019s speeches. The White House said the employee, Gabriel Perez, is cooperating with the CFTC and was placed on unpaid administrative leave.\n <\/p>\n

\n CNN has a partnership with Kalshi and uses its data to cover major events. But CNN editorial employees aren\u2019t allowed to trade on prediction markets.\n <\/p>\n

\n CFTC blasts Michigan judge
\n<\/h2>\n

\n Under current US law, prediction sites aren\u2019t considered gambling. Rather, they\u2019re financial markets that offer \u201cevent contracts.\u201d They\u2019re regulated like futures trading \u2013 but instead of focusing on commodities, users speculate on the outcomes of\u202felections, sporting events like the World Cup, awards shows, the weather and more.\n <\/p>\n

Read more Bronze Age \u2018shaman,\u2019 previously assumed to be a male metalworker, was actually a woman<\/a><\/p>\n

\n But Michigan and 40 other states believe prediction sites are gambling and are operating unlawfully without state gaming licenses. That\u2019s why Michigan Attorney General Dana Nessel, a Democrat, sued Kalshi back in March.\n <\/p>\n

\n Ingham County Circuit Judge Rosemarie Aquilina ruled in Nessel\u2019s favor last month, finding that Michigan residents were \u201cbeing exploited by Kalshi\u2019s sports betting operation masquerading as an investment opportunity.\u201d\n <\/p>\n

\n She ordered Kalshi to temporarily shut down its sports markets in Michigan and to cancel existing sports-related bets. That\u2019s what caught the CFTC\u2019s eye.\n <\/p>\n

\n \u201cCanceling trades that have already been executed is an unprecedented step that risks a cascading effect on the entire marketplace and undermines the certainty in contracting that is a necessary component of a functioning market,\u201d CFTC chair Mike Selig said in a statement announcing the move.\n <\/p>\n

\n He said he \u201cwill not allow states or state courts to bully\u201d prediction markets, throwing a lifeline to Kalshi, even if they apparently weren\u2019t asking for one.\n <\/p>\n

\n The Tuesday , signed by a career official, said \u201cKalshi shall fulfill the open trades in question as it would in the ordinary course of business.\u201d\n <\/p>\n

\n In an email to CNN, Nessel spokesman Danny Wimmer said the state attorney general Nessel disagrees with the CFTC\u2019s statements and blasted the CFTC\u2019s \u201cattempts to undermine states\u2019 efforts to regulate online sports betting and uphold state tax law.\u201d\n <\/p>\n

\n Traders rattled
\n<\/h2>\n

\n The standoff between the CFTC and Michigan has created waves in the rapidly growing prediction market community. These companies now see billions of dollars in weekly trading volume, according to outside data firms.\n <\/p>\n

\n \u201cThis is bonkers,\u201d said Nicholas Jager, one of Kalshi\u2019s top traders on culture markets and so-called mention markets, which try to guess what public figures say. \u201cAs traders, we just want to know the rules. It would make me nervous to trade these markets, if I was in a jurisdiction where this could happen.\u201d\n <\/p>\n

\n Kalshi is also currently blocked in Nevada, due to a similar ruling that the company is appealing. Meanwhile, a federal judge also rejected an attempt last week by the company to prevent New York from enforcing its state gaming laws.\n <\/p>\n

\n Many stakeholders expect the Supreme Court will eventually settle the matter, and cases are churning through appeals courts. Members of Congress from both political parties have also endorsed legislation to set a nationwide policy.\n <\/p>\n

\n \u201cThis move from the CFTC adds whole new layers of complications,\u201d Maine Gambling Control Board chair Steve Silver said. \u201cThe longer this goes on, the more we\u2019re going to see stuff like this. A patchwork of different rulings in different jurisdictions is no way to operate a multibillion-dollar industry.\u201d\n <\/p>\n

Read more National Guard deployment to DC will last through Trump\u2019s term<\/a><\/p>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

The Trump administration took an extraordinary step this week to escalate its nationwide efforts to prevent states from regulating prediction markets, where users can trade on real-world events like sports, politics and pop culture.<\/p>\n","protected":false},"author":1,"featured_media":6301,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[],"class_list":["post-6302","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-politics"],"yoast_head":"\nTrump regulator orders Kalshi to defy Michigan court \u2013 escalating battle over prediction markets - Relocation Times<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/relocationtimess.com\/?p=6302\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Trump regulator orders Kalshi to defy Michigan court \u2013 escalating battle over prediction markets - 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