Ohio is digging in against Kalshi, claiming that it wants to keep offering sports-related contracts, telling a federal appeals court the business is essentially dodging state gambling rules and shouldn’t keep operating while its appeal plays out.
In a new filing with the Sixth Circuit, state officials say the prediction market company is unlikely to win and hasn’t cleared the high legal threshold needed to justify an injunction during the appeal process.
“Sports bets are not ‘swaps’ under the Act,” the state wrote, pushing back on Kalshi’s claim that federal law overrides Ohio’s authority to regulate gambling.
Ohio’s attorneys portray Kalshi’s argument as an attempt to stretch federal law far beyond what Congress intended. The company has argued that changes to the Commodity Exchange Act in 2010 effectively handed control of sports betting to federal regulators.
The state rejects that outright. “Congress does not legislate through magic,” the brief states, saying there’s no clear wording in the law that supports such a major shift.
Officials also stress that swaps are meant to manage financial risk tied to economic outcomes. Sports wagers, they argue, hinge on game results and don’t involve “any relevant economic consequence.”
The dispute has been building for months. Kalshi launched its sports-related contracts in early 2025, offering markets tied to game outcomes and player performance. Ohio regulators quickly moved to stop the activity, prompting Kalshi to file a federal lawsuit against the Ohio Casino Control Commission.
A federal judge later sided with the state, rejecting Kalshi’s request for an injunction and finding that “Kalshi fail[ed] to establish that Congress intended the [Act] to preempt state laws on sports gambling.” Kalshi has since asked the appeals court to halt Ohio’s enforcement while the case continues.
The broader fight has drawn outside attention. A coalition of 30 tribal groups filed a joint brief backing Ohio, warning that allowing Kalshi’s model could undermine existing gaming compacts and state-based regulation.
Ohio argues the risks go beyond legal theory. The state says letting Kalshi continue operating would weaken consumer protections, including age limits and oversight mechanisms that apply to licensed sportsbooks.
Kalshi, for its part, says it faces serious harm without court intervention, pointing to conflicting regulatory demands across states. Ohio counters that the company has already shown it can comply by suspending operations where required.
The state frames the request as extraordinary and unwarranted. “This Court should reject both of Kalshi’s requests,” the filing adds.
Featured image: Kalshi / Canva
