Kalshi Seeks Injunction Against Iowa Gambling Rules Over 9 State Code Chapters

2 articles · Updated · Courthouse News Service · Aug 7

A federal judge in Iowa heard Kalshi’s bid to permanently bar the state from applying gambling laws to its prediction market, after the company sued in March over possible future enforcement.
Kalshi argued the Commodity Exchange Act gives the CFTC exclusive authority over its event contracts, saying its exchange functions like a regulated derivatives market rather than a sportsbook with house-set odds.
Iowa countered that Kalshi’s sports event contracts, launched in 2025, operate like sports bets and said the injunction would wipe out enforcement across nine chapters of the Iowa Code.
Judge Stephen Locher pressed both sides on whether Kalshi has standing because Iowa has not explicitly threatened enforcement, though the attorney general’s office also has not ruled out acting later.
The case tests how far federal preemption reaches as prediction markets expand into sports, drawing support for Iowa from the American Gaming Association and 29 federally recognized tribes.