A federal appeals court ruled that prediction markets like Kalshi are gambling and can be regulated by states, a setback for the industry but likely headed to the Supreme Court.

• The Ninth Circuit sided with Nevada, saying Kalshi's "event contracts" on sports are really sports betting.
• The judge pointed to Kalshi's own ad calling itself the first app for legal sports betting in all 50 states.
• Another appeals court ruled the opposite way, so the Supreme Court will probably settle it — and is expected to favor the companies.
• Donald Trump Jr., who advises both Kalshi and Polymarket, told Republican state attorneys general to stop fighting these platforms.
• Kalshi and Polymarket are spending heavily on lobbying, podcast sponsorships, and both parties, and are signing deals with the US Open, NFL teams, and MLB teams.

Outlook: If the Supreme Court sides with the platforms, online betting becomes legal nationwide unless Congress steps in to classify it as gambling.