In a pivotal ruling for the future of event trading, a U.S. federal appeals court determined that prediction platform Kalshi cannot stop Nevada gaming regulators from overseeing its sports-related markets.

Kalshi had argued that its federally registered contracts should remain strictly under federal derivatives regulation, exempting them from traditional state-level sports gambling laws. However, the appellate panel rejected the company's bid to halt Nevada's oversight.

The landmark decision strengthens state regulators' authority as prediction exchanges increasingly blur the line between financial markets and sports wagering.