You Won’t Believe Why the US Is Suddenly Throwing in the Towel on Kalshi!

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If ever there was a moment for uncorking the non-alcoholic champagne (one must maintain decorum, after all), it’s now: the US Commodity Futures Trading Commission (CFTC), that venerable guardian of financial propriety, is sidling up—with a bashful cough and a sheepish grin—to the judicial bench, begging permission to drop their appeal against the prediction market Kalshi. Whether they’ll send Kalshi a “We’re Sorry” fruit basket is yet to be seen, but one detects the scent of truce in the air, mingled with the unmistakable whiff of political popcorn. 🍿

In a filing on May 5, which doubtless caused several barristers to spill their tea in excitement, CFTC lawyers sauntered up to the US Court of Appeals in D.C., waving a motion for voluntary dismissal like a white flag at a cricket match. The motion was “unopposed”—which is legalese for “Kalshi didn’t object, presumably because someone had just offered them the keys to Parliament.” If the esteemed court gives the nod, the whole contretemps could vanish faster than a scone at afternoon tea, letting Kalshi trot out its political betting contracts without any more regulatory hair-pulling or fainting fits.

True sportsfolk, Kalshi declared they’d “bear their own costs, court fees and attorney fees incurred” if the CFTC’s grand exit was permitted. Not quite the war hero’s welcome, but these days, who can resist a little bit of noble suffering? The platform’s May 6 missive on X (look at them, using the trendy nomenclature!) positively beamed: “election markets are here to stay.” One almost expects them to break out into song. 🎶

In the beginning, it was Kalshi who launched the legal equivalent of a glove slap against the CFTC in 2023. The CFTC, ever the enthusiast for forms and prohibitions, ordered them to cease offering bets on political shenanigans—Kalshi objected, went to court, won, and watched the regulators stomp off in a huff before returning with an appeal in September 2024 for another round of bureaucratic fencing.

Is This Sudden Change of Heart About a Change in Top Hats?

Everyone knows regulators rarely do anything quickly unless there’s a new boss wielding the ceremonial cane. This particular case brewed before the US election and the anointment of Acting CFTC Chair Caroline Pham under President Donald Trump’s eagle eye. Yet, Commissioner Summer Mersinger—Biden’s nominee—apparently took a moment in February to channel Kalshi’s optimism, announcing that “election prediction markets were here to stay.” Clearly, fortune favors the bold, as well as those with a sufficient legal defense fund. 🏦

Since its debut in 2021, Kalshi has become the talk of the crypto salons, especially among those who fancy themselves clever enough to pick the real winner of the 2024 US election. Meanwhile, over at the CFTC, gloomy prophets warned of “spectacular manipulation” and public harm (presumably, dogs and cats living together, total chaos). But with the latest motion for dismissal, the regulatory winds appear to be blowing in a less stuffy direction. Watch this space—or perhaps just place a wager on it.

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2025-05-07 01:26