Kalshi, Polymarket Face Shutdown Risk in Nevada as Judge Allows State Regulator to Continue Pursuit of Temporary Restraining Order

March 3 (Monday) — A U.S. federal judge has ordered the remand of Nevada’s lawsuits against prediction market platforms Kalshi and rival Polymarket to state court, allowing state regulators to proceed with their push for preliminary injunctions. The ruling raises the risk both platforms could be forced to halt trading in Nevada. The court determined Nevada’s Gaming Control Board’s claims are “state-law-based,” and the Commodity Exchange Act (CEA) does not “completely preclude” state gambling laws from applying — meaning federal courts lack jurisdiction. Previously, both companies argued the U.S. Commodity Futures Trading Commission (CFTC) holds “exclusive jurisdiction” over the disputed event contracts. If Nevada secures the injunction, Kalshi could be barred from offering event contract products to in-state users during the litigation. Legal analysts call the ruling a “significant setback” for Kalshi, warning it may trigger a “domino effect” with more states launching similar suits. On the same day, the court also remanded the case against Polymarket parent Blockratize to state court. Polymarket has filed for an emergency stay to prepare an appeal, while Kalshi may seek a temporary stay from the U.S. Supreme Court. Related filings would go to Justice Elena Kagan, who oversees the Ninth Circuit. Analysts note that if more states follow Nevada with state-level injunctions, prediction market platforms will face a choice: comply with fragmented state rules or block users in those states — either way, weakening market liquidity.