Kalshi has filed a federal lawsuit challenging a new Illinois law that would require prediction market platforms offering sports event contracts to obtain state licenses before operating.

According to a filing submitted Tuesday in the U.S. District Court for the Northern District of Illinois, Kalshi sued Illinois Governor JB Pritzker, Attorney General Kwame Raoul, members of the Illinois Gaming Board, and other state officials, arguing that the state has overstepped federal authority over regulated prediction markets.

The complaint targets Illinois Senate Bill 3019, which was signed into law last week as part of the state’s fiscal year 2027 budget package. Kalshi argued that the legislation unlawfully interferes with the Commodity Exchange Act by treating sports event contracts offered on federally regulated prediction markets as sports wagers subject to state licensing requirements. The company said the law is scheduled to take effect on July 1.

Kalshi says federal rules override Illinois licensing requirements

According to the complaint, Kalshi believes the Commodity Futures Trading Commission has exclusive authority over its event contracts because they are regulated under the Commodity Exchange Act. The company alleged that Illinois cannot impose an additional licensing system on products already overseen by the federal regulator.

Kalshi argued that stopping sports event contracts in Illinois would leave the company in conflict with the CFTC’s requirement to operate a uniform national market. The filing also claimed that restricting Illinois users would force Kalshi to build costly technology systems to block access in the state, expenses it said could not be recovered even if it later won the case.

At the same time, the complaint argued that complying with Illinois’s licensing framework would expose the company to another set of costly regulatory obligations. According to Kalshi, ignoring the new law is also not a practical option because state enforcement could include criminal penalties.

The disputed legislation also introduced a 0.2% tax on cryptocurrency transactions, a measure that has already drawn criticism from several participants in the digital asset industry.

In addition, the law expanded the state’s definition of an “exchange wager” to include agreements, contracts, transactions, or swaps traded on prediction markets when tied to sporting contests, placing those products under the same rules as traditional sports betting operators.

Legal dispute grows as Kalshi expands business

The Illinois case adds to a series of legal disputes over whether states or the federal government has primary authority over sports-related prediction markets.

The CFTC, now led by Commissioner Michael Selig, has maintained that prediction market event contracts fall under its jurisdiction because they qualify as swaps under federal law. Federal regulators have already challenged similar state actions, including recent litigation involving restrictions imposed in Kentucky.

Legal analysts have suggested that the conflicting positions taken by state gaming regulators and federal authorities could eventually require resolution by the U.S. Supreme Court if lower courts continue reaching different conclusions.

Meanwhile, the lawsuit comes as Kalshi continues expanding its business. The company has reportedly entered discussions to raise fresh funding at a valuation of about $40 billion, up from the $22 billion valuation it secured less than two months ago.

Sports-related contracts account for roughly 65% of trading volume, according to company data, while multi-outcome combination contracts introduced last year have become one of its fastest-growing products.

Recent product launches have also extended Kalshi’s regulated offerings. As reported by crypto.news, on June 24, the company added perpetual crypto futures tied to Zcash, Near Protocol, and Shiba Inu, increasing its CFTC-regulated lineup to 13 digital assets operating under contracts without expiration dates.

Quick Summary

• Micron’s quarterly report served as a critical barometer for ongoing AI infrastructure investment
• Chip stocks like Nvidia and Broadcom rebounded strongly following this week’s earlier downturn
• SK Hynix unveiled plans for a U.S. stock market debut potentially worth $29 billion
• The Nasdaq regained ground after multiple days of technology-led losses
• Cerebras delivered earnings results, offering insight into specialized AI chip demand

Artificial intelligence remained front and center across financial markets today. Between quarterly earnings announcements and a blockbuster listing reveal, semiconductor companies commanded attention from traders and investors alike.

Micron’s Report Becomes AI Demand Litmus Test

[[LINK_START_0]]Micron’s quarterly earnings release[[LINK_END_0]] stood as the session’s most anticipated event.

Market participants track Micron carefully since its memory products power AI servers and data center infrastructure. Robust performance in these segments indicates continued aggressive spending by hyperscalers on artificial intelligence capabilities.

Anticipation ran high ahead of the announcement. Micron shares had delivered solid returns throughout 2026, leaving Wall Street eager for validation that high-bandwidth memory sales momentum persisted.

The implications extended well beyond a single company’s performance. Positive figures would reinforce optimism about semiconductor industry health. Disappointing numbers might trigger concerns about the actual pace of AI capital expenditure growth.

Few quarterly reports this season attracted comparable investor scrutiny.

Chip Sector Mounts Strong Recovery

Following recent pressure, semiconductor equities rallied meaningfully.

Nvidia, [[LINK_START_1]]Broadcom[[LINK_END_1]], and Intel all posted gains as capital flowed back into AI-linked stocks. The price action indicated many market participants viewed the recent selloff as an entry point rather than a fundamental warning.

AI-related capital spending continues representing one of the market’s most powerful tailwinds.

Hyperscale cloud providers maintain multi-billion-dollar commitments to data center expansion, advanced processors, and networking infrastructure. Today’s recovery demonstrated that underlying conviction in the sector remains intact.

Volatility has increased noticeably, yet demand emerged swiftly at lower price levels.

SK Hynix Announces Plans for $29 Billion U.S. Market Debut

The session’s most significant corporate development originated from SK Hynix.

The South Korean memory manufacturer disclosed intentions to pursue a United States listing in a transaction potentially generating approximately $29 billion. Upon completion, this would represent one of the largest public offerings on record.

[[LINK_START_2]]SK Hynix[[LINK_END_2]] specializes in high-bandwidth memory production, a critical component enabling contemporary AI system performance.

A U.S. market presence would provide investors with direct exposure to one of the most sought-after segments within the semiconductor value chain. The announcement underscores extraordinary investor appetite for AI-connected equity opportunities.

Nasdaq Composite Regains Momentum

The [[LINK_START_3]]Nasdaq[[LINK_END_3]] index posted positive returns following multiple consecutive down sessions.

Technology shares paced the advance as market participants grew increasingly comfortable with current valuations after the recent correction. While inflation and monetary policy concerns persist, buying interest nonetheless materialized.

The rebound indicates investors remain prepared to add exposure when high-quality technology companies experience pullbacks.

Semiconductors, AI infrastructure providers, and cloud computing firms continue leading broader market performance over the trailing twelve months.

Cerebras Provides Additional AI Sector Perspective

[[LINK_START_4]]Cerebras[[LINK_END_4]] published quarterly results as well, capturing attention from investors seeking exposure beyond dominant chip manufacturers.

The firm produces processors engineered exclusively for artificial intelligence computing tasks. Its financial performance offered visibility into demand patterns for specialized hardware operating outside Nvidia’s ecosystem.

The report contributed additional data points suggesting AI hardware investment remains broadly distributed rather than concentrated among just a handful of suppliers.

Investors continue monitoring emerging players like Cerebras to gauge the true breadth of AI infrastructure deployment.

The quarterly figures reinforced that artificial intelligence maintains its position as the defining investment theme propelling technology sector allocation as 2026 progresses.

Kalshi is seeking to raise fresh capital at a valuation of about $40 billion, nearly doubling the $22 billion valuation it targeted in its previous funding round, according to a Financial Times report citing people familiar with the matter.

The prediction markets platform could close the fundraising as soon as the third quarter of this year, FT said.

If completed, the deal would widen Kalshi’s valuation lead over rival Polymarket, which was last reported to be seeking funding at $15 billion. The two platforms have emerged as the dominant names in the prediction markets sector, while many other entrants have increased the industry’s competitive landscape.

Kalshi’s previous funding round, which valued the company at $22 billion, attracted a roster of high-profile investors including Philippe Laffont’s Coatue Management, Sequoia Capital, Andreessen Horowitz and Morgan Stanley.

Competition in the sector has intensified as firms race to capture users and expand product offerings.

Kalshi operates as a federally regulated exchange in the United States, a distinction that has helped it attract mainstream investors and institutional backing. Meanwhile, Polymarket, which uses blockchain infrastructure and cryptocurrency-based settlement, has gained popularity among crypto traders and has become widely followed during recent election cycles.

Michelle Bond, the wife of Ryan Salame—former co-CEO of FTX Digital Markets—has been scheduled for trial in November following delays tied to motions connected to Salame’s plea agreement. The proceeding comes as prosecutors pursue remaining criminal accountability related to the 2022 collapse of FTX, an episode that has since reshaped regulatory scrutiny of crypto-linked political activity and financial crime controls.

On Wednesday, U.S. District Judge George Daniels of the Southern District of New York set Bond’s trial to begin on Nov. 9. Bond faces four charges alleging violations of U.S. campaign finance law, stemming from prosecutors’ claims that FTX-related money was used to improperly support a 2022 congressional bid.

Key takeaways

• Judge George Daniels ordered Michelle Bond’s criminal trial to start on Nov. 9 in the Southern District of New York.
• Bond is charged with four offenses related to alleged campaign finance violations connected to the 2022 U.S. House race in New York’s 1st district.
• Prosecutors alleged that Ryan Salame used FTX funds in a “sham” payment arrangement, which they said violated campaign finance rules.
• The case is part of the final criminal track arising from FTX’s 2022 bankruptcy, following convictions and prison sentences for other key figures.

Bond’s trial date set amid motion-related delays

Bond’s schedule reflects procedural disputes that have continued since the charges were brought. A week earlier, Judge Daniels denied a motion by Bond seeking dismissal of the indictment. According to reporting by Cointelegraph, the defense argued that prosecutors had promised Salame he would not be charged if he pleaded guilty—an issue that, if accepted, could have materially affected Bond’s exposure.

With the dismissal attempt rejected, the court moved forward to establish a firm trial start date. For compliance and legal teams, the decision is significant because it underscores how plea negotiations and alleged assurances can become contested topics in later proceedings involving related defendants, even when one defendant has already resolved the matter through a plea agreement.

Alleged campaign finance conduct tied to the FTX collapse

Bond’s case is anchored in an August 2024 indictment. Prosecutors alleged that Bond and Salame “illegally funded” Salame’s political activity by using FTX resources to support a 2022 campaign for the U.S. House of Representatives.

The government’s allegations include that Salame used $400,000 of FTX funds as part of a “sham” payment intended to comply on paper while violating campaign finance laws in substance. Bond reportedly ran as a Republican in New York’s 1st congressional district, though she lost in the primary to Nicholas LaLota.

From an institutional perspective, the case illustrates a recurring enforcement theme: where crypto-related business failures intersect with political contributions, prosecutors may pursue campaign finance statutes in addition to financial fraud and related offenses. That creates additional compliance expectations for crypto firms and their leadership regarding the provenance of funds, controls around payments, and documentation that can withstand scrutiny across regulatory regimes.

How the plea deal with Salame shaped the remaining proceedings

Ryan Salame pleaded guilty and ultimately received a 7.5-year prison sentence, concluding his own criminal case. Authorities alleged that, as part of a conspiracy to make unlawful political contributions, Salame and others used money linked to FTX to support political activity. Salame later attempted to vacate his plea, arguing that prosecutors had misled him regarding whether Bond would face charges. Ultimately, he reported to prison in October 2024, leaving the dispute to continue within his wife’s case.

Bond’s trial therefore sits at the end of a broader U.S. prosecution landscape stemming from FTX’s collapse and its aftermath. The government’s pursuit of multiple individuals tied to FTX has included defendants who received prison time, as well as cooperation outcomes that reduced sentences for some witnesses.

In addition to Bond’s expected trial, the FTX criminal docket has largely reached resolution for several other participants. Sam “SBF” Bankman-Fried and Caroline Ellison—former Alameda Research CEO—were convicted or sentenced in separate proceedings. Two other former executives, Nishad Singh and Gary Wang, were given time served after testifying against Bankman-Fried at trial, reflecting the structure of cooperation-driven outcomes.

Parallel litigation: Bankman-Fried’s appeal and pardon bid

While Bond’s matter moves toward trial, Sam Bankman-Fried remains at a different procedural stage. Authorities convicted him on seven felony charges and sentenced him to 25 years in prison in 2024. Although Bankman-Fried sought to appeal his conviction and sentence, the Second Circuit recently rejected his appeal, leaving limited avenues for relief.

Separately, Bankman-Fried has pursued clemency routes, including applying for a presidential pardon from Donald Trump. However, as the appellate process has narrowed, the practical pathway to freedom is now tied either to further legal escalation to the U.S. Supreme Court or to executive action via pardon—an uncertainty that continues to shape the political and legal discourse around the case.

For institutional observers, this matters less because it affects crypto markets directly and more because it highlights how high-profile crypto fraud enforcement can diverge into distinct tracks: courtroom adjudication, sentencing appeals, and executive clemency. These overlapping tracks can influence how defense strategies and prosecutorial positions are evaluated in future cases with similar fact patterns involving financial wrongdoing and political or public-facing conduct.

Closing perspective

Bond’s Nov. 9 trial date sets a clear procedural next step, but unresolved questions around the indictment’s dismissal arguments—and how courts treat alleged assurances connected to plea deals—could still be consequential if litigated through motions and pretrial rulings. As the remaining FTX-related prosecutions narrow toward final outcomes, compliance professionals should watch how courts evaluate links between crypto-linked funding flows and regulated activity outside the financial sector, including campaign finance rules.

TLDR:

• Ethereum is trading near $1,600, approximately 21% below its 30-day peak amid sustained market weakness.
• Two whale wallets withdrew $58.83M in ETH from Kraken and Bitgo, matching prior Bitmine purchase patterns.
• Binance stablecoin reserves and netflows have shifted to neutral, signaling a pause in aggressive capital flight.
• The bullish regime shift probability has climbed to 45%, but confirmation signals are still needed before acting.

Ethereum is trading around $1,600, roughly 21% below its 30-day peak, as on-chain data and whale activity draw renewed attention.

A quantitative regime model currently enforces a highly defensive stance, limiting market exposure to just 15%. Yet underlying metrics are shifting, with the probability of a bullish regime transition climbing to 45%.

Analysts and market observers are watching closely for confirmation signals before adjusting their positioning.

Defensive Model Meets Stabilizing Liquidity

Ethereum’s current price decline reflects a broader period of caution across crypto markets. The systematic regime model relies on multiple data layers, not price action alone.

It factors in Bitcoin’s structural cycles, derivative flows, and stablecoin dynamics on major exchanges like Binance.

Trend filters remain weak, with a moving average death cross showing a spread of -18.8%. That reading keeps the model in a highly defensive mode, reducing exposure significantly. However, momentum indicators tell a different story at the margin.

MACD histograms are contracting positively, suggesting that selling pressure may be running out of steam. This divergence between long-term trend weakness and short-term momentum stabilization is a key feature of the current setup.

Crucially, stablecoin data on Binance adds another layer of nuance. Stablecoin reserves registered a z-score of -0.32σ, while netflows came in at +0.20σ, both now in neutral territory.

This suggests the aggressive capital flight seen during deep corrections has paused, and exchange liquidity is no longer actively draining.

Whale Withdrawals Add a Bullish Variable

On-chain intelligence firm Arkham flagged notable activity from two fresh whale addresses this week. The wallets withdrew a combined $58.83 million worth of Ethereum from Kraken and Bitgo within hours.

Arkham noted that the purchase patterns matched prior observed activity linked to Bitmine, raising speculation about institutional accumulation.

Arkham posted on X: “Is Tom Lee stacking ETH this week?” referencing Bitmine chairman Tom Lee, known for public bullish stances on digital assets. The withdrawal pattern drew attention because it occurred against a backdrop of broader price weakness.

Ethereum recorded a 2.94% decline over the past 24 hours and a 7.43% drop over the past seven days, with 24-hour trading volume reaching $13.08 billion. Despite that, large-wallet behavior suggests some participants are positioning ahead of a potential reversal.

A decisive shift in Binance stablecoin netflows toward positive territory could serve as an early signal of returning risk appetite.

Until that confirmation arrives, the data supports patience rather than conviction in either direction. Ethereum’s next move may depend on whether these liquidity and behavioral signals continue to align.

Kalshi has entered talks to raise fresh capital at a valuation of about $40 billion, an 82% jump from the $22 billion valuation it secured less than two months ago.

According to a Financial Times report citing people familiar with the discussions, Kalshi is seeking a new funding round that could value the prediction market operator at roughly $40 billion, with the financing potentially closing as early as the third quarter.

The proposed valuation would represent another sharp increase for the company, which was valued at $22 billion during a $1 billion funding round completed in May. Earlier in 2025, Kalshi carried a valuation of about $5 billion, while its December valuation stood at $11 billion before doubling in the latest raise.

Investors in the previous financing included Coatue, Sequoia Capital, Andreessen Horowitz, and Morgan Stanley. If completed, the new round would push Kalshi’s valuation to eight times the level recorded at the beginning of the year.

Trading growth has supported investor interest

Financial Times reported that Kalshi’s rapid expansion has been driven by rising activity across prediction markets tied to sports, politics, financial markets, and entertainment.

Company figures show that Kalshi processed more than $17 billion in trading volume last month, up from less than $5 billion during the same period a year earlier. During its May fundraising announcement, the company said annualized trading volume had reached $178 billion, more than three times the level recorded six months before.

Sports-related contracts remain the platform’s largest category, accounting for about 65% of total volume, according to company data. Multi-outcome combination contracts introduced last year have also become one of Kalshi’s fastest-growing products.

Recent product launches have extended the company’s reach beyond event markets. Earlier on June 24, Kalshi expanded its Commodity Futures Trading Commission-regulated crypto perpetual futures lineup by adding contracts tied to Zcash, Near Protocol, and Shiba Inu. The additions increased the number of supported digital assets to 13, with the contracts operating without expiration dates under a structure approved by the CFTC.

Legal disputes continue across multiple fronts

While pursuing new funding, Kalshi remains involved in several legal and regulatory battles linked to its products.

A recent dispute emerged after the company launched cryptocurrency perpetual futures following approval from the CFTC. CME Group subsequently sued the regulator, arguing that the products should be classified as swaps and subjected to a different regulatory review process.

Elsewhere, state-level challenges continue to target Kalshi’s event contracts. Arizona filed criminal charges against the company in March, alleging that it operated without a gambling license and offered prohibited election-related contracts.

Separately, a Massachusetts judge ordered Kalshi to stop offering sports-related contracts in the state unless it obtains a local gaming license.

Kalshi has contested those actions and maintains that its event contracts fall under the exclusive jurisdiction of the federal derivatives regulator. As the company seeks another major funding round, the ongoing court cases are unfolding alongside its push into new markets and the rapid growth of its trading business.