CFTC files emergency complaint to block Kalshi’s election contracts
Date: 2024-09-09 Author: Henry Casey Categories: IN WORLD
The U.S. Commodity Futures Trading Commission (CFTC) has filed an emergency complaint seeking to block U.S.-based predictive market firm Kalshi from offering election contracts. The filing comes just hours after a judge overturned a previous order that halted Kalshi’s election markets.
The CFTC asked for an “emergency stay” of the court’s order overturning its order to block Kalshi from listing election contracts, according to a Sept. 6 court filing.
CFTC Cannot Make Reasonable Decision Without Court's Reasoning
The regulator requested that the court "stay the stay" for 14 days after issuing a detailed opinion explaining why the order was vacated.
The CFTC argues that without "the benefit of the court's reasoning," it cannot make a reasoned decision "about whether to appeal, nor can it fully prepare the stay application in anticipation of any pending appellate review."
"Time is of the essence in issuing a stay. The CFTC expects Plaintiff Kalshi to promptly post the relevant election contracts, and trading will commence immediately upon posting the contracts," the CFTC explained.
The regulator based its request on the fact that Kalshi had already announced on its home page: "Election Markets Are Coming to Kalshi!"
The filing came the same day that Judge Gia Cobb of the U.S. District Court for the District of Columbia ruled in favor of Kalshi, allowing it to offer products that allow betting on who will win the November 4 U.S. election.
Lawyers call the ruling a “massive win” for Kalshi
Variant Fund General Counsel Jake Chervinsky said in a September 7 X post that Kalshi had scored a “HUGE win,” but he also wanted to see the court’s opinion first.
“I want to see the opinion before I start celebrating, but this further reinforces that the best way to combat regulatory overreach is to file MORE LAWSUITS,” Chervinsky added.
The CFTC originally filed its ruling in September 2023, arguing that “the CFTC has determined that the contracts involve gambling and activity that is illegal under state law and contrary to the public interest.”
