A federal judge has blocked Arizona from pursuing its criminal case against Kalshi by granting the temporary restraining order requested by the Commodity Futures Trading Commission (CFTC) last week.
The CFTC announced the ruling on Friday, 10 April, after the federal derivatives regulator pledged to support prediction market platforms in their US state-level legal battles.
The motion for a temporary restraining order and preliminary injunction against Arizona was filed by the CFTC on Wednesday, 8 April.
The CFTC filed a motion with the US District Court for the District of Arizona.
Kalshi’s fight with Arizona began last month when the Grand Canyon State filed criminal charges against the prediction markets platform, becoming the first state do so.
Alongside the criminal charges being filed, Attorney General Kris Mayes alleged Kalshi was illegally offering gambling in Arizona without a licence.
Federal judge Michael Liburdi had previously denied a request by Kalshi’s for a temporary restraining order against the state, with a subsequent arraignment having been scheduled for today, 13 April.
However, Liburdi has now approved the CFTC’s request, with the ruling noting that event contracts fall within the Commodity Exchange Act’s definition of “swaps”.
The ruling also stated the CFTC had “demonstrated a reasonable chance of success in showing that the act preempts Arizona law”.
At the start of April, the CFTC filed complaints against Arizona, Connecticut and Illinois, requesting permanent injunctions blocking the states from taking legal action against prediction markets such as Kalshi and Robinhood.
The Trump administration sued the three states concurrently for the same reason.
Michael Selig, CFTC chair, said: “The CFTC appreciates the court’s careful consideration of these important legal questions and the court’s decision to preserve the status quo.
“Arizona’s decision to weaponise state criminal law against companies that comply with federal law sets a dangerous precedent, and the court’s order today sends a clear message that intimidation is not an acceptable tactic to circumvent federal law.”
Robert J Denault, head of enforcement and legal counsel at Kalshi, praised the ruling as a “step in the right direction” on social media.
Last week, a federal court panel ruled that New Jersey’s gambling regulator had no jurisdiction over the event contracts offered by Kalshi in a landmark ruling.
The post Kalshi scores win in Arizona after CFTC-backed temporary restraining order approved first appeared on EGR Intel.
Federal regulator’s request to block state’s pursuit of criminal charges against prediction market is granted, with decision heralded as a “clear message” by CFTC chief
The post Kalshi scores win in Arizona after CFTC-backed temporary restraining order approved first appeared on EGR Intel.