A significant legal decision has made election betting legal in the U.S. for the first time in over a century. The Commodity Futures Trading Commission (CFTC) recently dropped its appeal of a court ruling that allowed KalshiEx, a prediction market platform, to offer contracts on the outcomes of U.S. elections.
In a filing with the U.S. Court of Appeals for the District of Columbia Circuit, the CFTC confirmed that both parties agreed to dismiss the appeal on mutually agreed terms. This decision clears the way for Kalshi to offer contracts on election results, including presidential nominations, Senate races, and gubernatorial elections.
The case began in 2023 when the CFTC blocked Kalshi’s proposal to offer election-related contracts, arguing that the agency had the authority to regulate such markets. However, in a September 2024 ruling, U.S. District Judge Jia Cobb ruled in favor of Kalshi, stating that the CFTC had overstepped its bounds. The appeals court upheld the decision, and in May 2025, the CFTC voluntarily dropped its appeal, solidifying Kalshi’s right to operate these markets.
Kalshi CEO Tarek Mansour called the ruling “historic,” celebrating the decision as a turning point for the future of prediction markets in the U.S. “Kalshi’s approach has officially secured the future of prediction markets in America,” Mansour said in a statement.
While the ruling opens the door for Kalshi’s election betting contracts, individual states still hold the power to regulate or ban such markets. This means the future of election betting could vary across the country, depending on state laws.
Some critics, including Better Markets, a financial reform group, warned that the ruling could lead to market manipulation and undermine the integrity of elections. Despite these concerns, Kalshi’s success marks a major shift in the legal landscape for prediction markets in the U.S.
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