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Well-known CFTC-registered exchanges used by tens of millions of Americans—including Kalshi, Polymarket, Coinbase and Crypto.com—face an onslaught of state-driven litigation across the country, with nearly 50 active cases presenting a range of legal challenges. The most common allegation is that these contracts are a form of gambling and therefore subject to state laws.
Event contracts serve legitimate economic functions. They allow businesses and individuals to hedge event-driven risks, enable investors to manage portfolio exposure, and provide the public with information about the outcome of future events. Farmers can manage risk related to temperature changes that may affect crops, and small-business owners can hedge against tax increases or energy-price spikes, to name two examples.
