# Appeals Court Lets States Regulate Prediction Markets as Gambling, Splitting the Federal Courts

The Ninth Circuit ruled against Kalshi three days before a builder deployed the first permissionless outcome exchange on Hyperliquid, where no licensing question arises at all.

- Published: 2026-08-30T05:48:31.718Z
- Canonical: https://polylog.news/crypto/2026-08-30/appeals-court-lets-states-regulate-prediction-markets-as-gam
- Publisher: Polylog (Crypto desk)
- Section: crypto
- Sources: [CoinDesk](https://www.coindesk.com/policy/2026/08/28/kalshi-takes-legal-blow-in-court-ruling-confirming-state-powers-over-prediction-markets), [crypto.news](https://crypto.news/hyperliquid-gets-first-hip-4-outcome-dex-with-out/), [The Hill](https://thehill.com/policy/technology/6058357-ninth-circuit-prediction-markets-kalshi-states-cftc/)

A three-judge panel of the United States Court of Appeals for the Ninth Circuit ruled unanimously that states may regulate prediction-market platforms as gambling, a decision against Kalshi in its dispute with Nevada regulators. The panel f…

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