Crypto World
Blockstream CEO Denies Jeffrey Epstein Ties Following DOJ Document Release
TLDR
- Adam Back stated that Blockstream has no financial ties to Jeffrey Epstein or his estate.
- 2014 emails show Blockstream co-founders discussed funding round allocations with Epstein and Joi Ito.
- Travel emails referenced a planned visit to St. Thomas involving Back and Hill.
- Jeffrey Epstein exchanged crypto-related emails with Peter Thiel and discussed Bitcoin’s use cases.
- Jeffrey Epstein proposed a Sharia-compliant digital currency in 2016 and communicated with multiple tech figures.
Blockstream CEO Adam Back responded to newly released Epstein documents by denying any financial connection between his company and Epstein. The U.S. Department of Justice released a new batch of records under the Epstein Files Transparency Act. Back’s statement followed reports linking Blockstream’s 2014 funding round to Jeffrey Epstein and MIT Media Lab’s Joi Ito.
Emails Show Early Contact Between Epstein and Blockstream Founders
In a 2014 email, Blockonomi earlier reported that Blockstream co-founder Austin Hill addressed Jeffrey Epstein and Joi Ito regarding a seed funding round. Hill said the round was oversubscribed and mentioned an increased allocation from $50,000 to $500,000 for Epstein. Adam Back was included in the same email thread, which showed communication between all parties during the funding process.
In 2014, during Blockstream’s seed-round investor roadshow, the company was introduced to then MIT Media Lab director Joi Ito. Subsequently Blockstream met with Jeffrey Epstein, who was described at the time as a limited partner in Ito’s fund. That fund later invested a minority…
— Adam Back (@adam3us) February 1, 2026
In another document, Hill informed Epstein’s associate Daphne Wallace about travel arrangements involving St. Thomas, referencing Adam Back in the same thread. Hill said they were “happy to arrange for our own flights” after the St. Thomas stop. The destination raised questions due to its proximity to Epstein’s private island.
Back confirmed that the company met Jeffrey Epstein through Ito during their investor roadshow. He stated, “Blockstream has no direct nor indirect financial connection with Jeffrey Epstein or his estate.” Hill reposted Back’s full statement on the social media platform X, reaffirming the company’s position.
Back added that Epstein was introduced to them as a limited partner in Ito’s fund, which held a minority stake. He said the fund later divested its Blockstream shares due to a possible conflict of interest. However, Back did not address the specific travel emails involving St. Thomas mentioned in the DOJ documents.
DOJ Files Show Crypto Links to Jeffrey Epstein
The newly unsealed documents show Jeffrey Epstein had conversations about crypto with Peter Thiel in July 2014. In an email, Epstein questioned Bitcoin’s purpose, saying, “There is little agreement on what Bitcoin is.” He also mentioned the contradictions between transparency and anonymity in the technology.
Other emails revealed Hill discouraged Ito and Epstein from backing Stellar and Ripple. He claimed those projects were “bad for the ecosystem” and conflicted with Blockstream’s goals. Hill also warned that supporting multiple crypto ventures could damage trust and company stability.
One of Jeffrey Epstein’s emails from 2016 showed he proposed digital currency plans to Saudi Arabian officials. He outlined a physical fiat currency called “the Sharia” and a Bitcoin-based digital currency. The proposal included goals for internal Muslim financial systems and regional currency innovation.
Other tech and finance names appeared in the unsealed records, including Michael Saylor and Kevin Warsh. Warsh was recently nominated as the next Federal Reserve chair. These names surfaced within over six million pages released under the new transparency law.
US Senate Banking Committee member Bill Hagerty said Monday that he expects a potential path for a digital asset market structure in the coming weeks after months of delays in Congress.
Speaking at the Digital Assets and Emerging Tech Policy Summit at Vanderbilt University, he said his fellow Republican lawmakers planned to move the bill through the banking panel starting next week.
“We will be in a position, I hope, to bring all of this together very soon,” said Hagerty, referring to work on the bill in the Senate. “On the banking committee side, I think we’re very close, and my expectation is that we get it into committee in this next work period that starts on Monday of next week, so that over the next several weeks we should have this into the banking committee.”
The Tennessee senator added:
“There’re several issues still outstanding, I think none of them are insurmountable and we will get to a point I believe in April that we’ll have it out of the banking committee. There’s still a lot more work to do.”
Originally titled the CLARITY Act when it passed the House of Representatives in July, the bill is considered by many lawmakers and industry leaders to be one of the most significant pieces of crypto legislation, but it has faced delays in Congress amid government shutdowns, industry pushback on stablecoin yield and ethics concerns.
It is expected to provide a comprehensive framework for cryptocurrencies in the US, including largely changing oversight of the market from the Securities and Exchange Commission (SEC) to the Commodity Futures Trading Commission (CFTC).
Because both agencies are involved, the legislation would need approval from the committee responsible for commodities — Senate Agriculture — and that for securities, the banking committee. The agriculture committee advanced its version of the crypto bill in a January markup, but concerns over tokenized equities, ethics, and stablecoin yield have delayed consideration in the banking committee, which needs to hold a markup before a potential floor vote in the Senate.
Related: CFTC chair says agency is ready to oversee entire crypto market
“We’re going into the midterms,” said Hagerty. “I think if we get this done in April, we can clearly get this taken care of before the midterms.”
Limited window for market structure as crypto potentially influences US elections again
Hagerty’s comments echoed those of Coinbase chief legal officer Paul Grewal, who said last week that lawmakers were “close to a deal” on stablecoin yield and other issues in the market structure bill.
According to the Coinbase-backed advocacy group Stand With Crypto, the way lawmakers vote on the legislation could impact their chances for the 2026 midterms, setting the stage for crypto interest groups to potentially influence another major US election.
The crypto-backed political action committee (PAC) Fairshake, which reported spending more than $130 million on media buys in the 2024 elections, said in January that it had a $193-million war chest ahead of the November 2026 midterms.
The group is not alone in its support for crypto on the national stage. The Fellowship PAC, which claimed to have raised “over $100 million” from undisclosed backers aligned with the crypto industry, announced the appointment of Tether executive Jesse Spiro as chair on Wednesday.
Magazine: Clarity Act risks repeat of Europe’s mistakes, crypto lawyer warns
The opportunity isn’t that AI is new. It’s that most businesses still don’t understand it.
Everyone says the same thing: Build an AI agency. The market is wide open. They’re half right. The market is open, but not for the reasons people think.
The real opportunity isn’t that AI is new. It’s the intelligence gap—the distance between what’s possible and what businesses actually understand. And almost nobody is positioning themselves to profit from it.
The Numbers Are Misleading
1.3 billion people use free ChatGPT. Sounds massive until you realize 15-25 million pay for any AI tool, and only 2.5 million actively use AI for coding. These numbers collapse when you compare them to 400+ million businesses worldwide.
Most businesses haven’t touched AI in any meaningful way. They heard the hype. Maybe they tried ChatGPT once to write an email. Then they forgot about it. The technology exists in their world as an abstract concept, not as a solution to their specific problems.
Here’s Where Most People Go Wrong
They chase tech companies. Startup founders. People who already understand AI. Why? Psychologically, it’s comfortable. These prospects get it. Conversations move faster. You don’t have to explain automation basics.
But strategically? It’s the worst market you could choose. You’re competing against thousands of other people with the same idea. Pricing is brutal. Margins evaporate. These companies shop aggressively because they understand your value.
The Smart Move: Chase “Boring” Industries
Dentists. Contractors. Accountants. Real estate brokers. Insurance agents. Dental practices. These industries have three things in common:
- They make real money. An HVAC contractor who closes one extra job monthly from faster lead response doesn’t blink at a $500 retainer. That’s a 10-20x ROI.
- Zero AI competition. Nobody is systematically selling automation to dental offices. The market is massive and completely unsaturated.
- They refer constantly. These industries are tight-knit networks. One successful implementation leads to introductions to three more. Build once, sell six times.
The Framework That Changes Everything
Everyone knows they should chase boring industries. Almost nobody does. The gap between knowing and executing is where the real competitive advantage lives.
Here’s How to Position Correctly
- Identify their specific expensive problem. Not that they need AI. Something concrete. Leads going cold. Proposals taking three hours. Data scattered across systems.
- Quantify the cost. You’re losing 15 leads monthly because nobody answers the phone. That’s $75,000 in lost annual revenue.
- Show them a solution that costs 1% of that impact. A $400/month system that prevents 10% of those losses pays for itself in one week.
Suddenly you’re not expensive. You’re obviously cheap. This is how you close deals.
What This Means for You
Stop chasing prestige prospects. Stop trying to impress people who understand AI. Pick one unsexy industry—dentists, contractors, accountants. Go deep on understanding their specific problems. Learn their language. Build solutions to their expensive bottlenecks.
These business owners are hungry. They see the opportunity but don’t know how to implement it. They have money and they’re willing to spend it. And they’re desperately underserved by specialists who actually understand their business.
That’s the intelligence gap. And if you’re the one filling it, you win.
Polymarket will rebuild its core engine, introduce a hybrid CLOB, and launch Polymarket USD, a USDC‑backed stablecoin on Polygon aimed at cheaper, more institution‑friendly trading.
Summary
- Prediction market Polymarket plans its “largest infrastructure upgrade” in the next 2–3 weeks, overhauling its matching engine and smart contracts.
- The upgrade will introduce a new hybrid CLOB model and a native stablecoin, Polymarket USD, pegged 1:1 to USDC on Polygon.
- The changes aim to cut gas costs, boost efficiency, and make the platform friendlier to institutions via EIP‑1271 and multi‑sig support.
On‑chain prediction market Polymarket will roll out what it calls “the largest infrastructure upgrade since its launch” in the coming 2–3 weeks, rebuilding its core trading engine and debuting a native dollar stablecoin, Polymarket USD, according to plans shared with The Block. The company said the overhaul will “completely reconstruct” its matching engine via a new CTF Exchange V2 smart‑contract system, while introducing a native stablecoin pegged 1:1 to USDC to replace the current bridged USDC.e on Polygon. Existing order books will be cleared during the migration, with Polymarket promising to give users at least one week’s notice before maintenance begins.
At the heart of the upgrade is a redesigned Central Limit Order Book that uses a hybrid model of off‑chain order matching combined with on‑chain, non‑custodial settlement. In technical documentation for its CTF Exchange, Polymarket describes the architecture as a “hybrid‑decentralized model” where an operator handles off‑chain matching while settlement remains on‑chain, a setup it says optimizes “performance and security” for high‑volume event markets. The Block reports that CTF Exchange V2 will introduce new matching logic and order‑data structures intended to improve matching efficiency and reduce gas costs for traders.
Polymarket has grown into one of the largest fully on‑chain prediction venues, recently drawing hundreds of millions of dollars in liquidity and a $600 million strategic investment from Intercontinental Exchange (ICE) as part of a broader bet on decentralized betting markets. ICE said its combined $1.6 billion of direct and secondary investment is not expected to be material to its financial results but positions the exchange operator as a key backer in what it calls a “David and Goliath battle” to bring prediction markets into the financial mainstream.
On the asset side, Polymarket USD formalizes a shift already underway in partnership with Circle to move from bridged USDC.e to native USDC on Polygon for all trading, order placement, and settlement. Circle has said native USDC, redeemable 1:1 for US dollars through its regulated entities, offers a “capital‑efficient” and more secure alternative to bridged tokens by eliminating cross‑chain bridge risk and tying collateral directly to its reserves. In line with that, Polymarket USD will be pegged 1:1 to USDC and used as the core collateral across the platform, with deposits from networks such as Ethereum, Solana, Arbitrum, and Base automatically converted into the new stablecoin on Polygon.
Polymarket will also add support for the EIP‑1271 (ERC‑1271) standard, allowing smart‑contract wallets such as Safe to validate signatures and trade directly, a move aimed at “expanding use cases for institutions and advanced users.” EIP‑1271 lets contracts define an isValidSignature method with arbitrary logic, making it easier for DAOs, funds, and multi‑sig setups to participate in non‑custodial markets without relying on externally owned accounts. The upgrade comes as competition in prediction markets intensifies, with Polymarket using performance, native dollar liquidity, and institutional‑grade wallet support to defend its lead in what it brands “The World’s Largest Prediction Market.”
Bitcoin found familiar resistance as it crossed the $70,000 mark to hit new April highs, with analysis blaming “profit-taking pressure.”
Bitcoin (BTC) coiled below $70,000 at Monday’s Wall Street open as analysis blamed profit taking for price inertia.
Key points:
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Bitcoin and stocks wobble as the US trading session begins amid nerves over the US-Iran war outcome.
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Profit taking activity is keeping BTC price action away from a $70,000 reclaim, says research.
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A Trader says $71,000 will act as fuel for a surge $10,000 higher.
BTC price meets “profit-taking pressure”
Data from TradingView showed BTC price action consolidating after hitting new April highs of $70,275 on Bitstamp.
Market nerves over the US-Iran war resulted in uncertain trading, with US stocks treading water at the open.
Speaking to the media at a military event, US President Donald Trump reiterated earlier comments that Iran would “have no bridges” and “no power plants” unless a deal was reached.
“I won’t go further because there are other things that are worse than those two,” he told reporters.
Trump previously stated that the deadline for a deal was 8pm Eastern time on Tuesday.
With price pinned below the $70,000 mark, onchain analytics platform Glassnode pointed to internal market forces as the reason for the lack of continuation higher.
“As price probed the $70K region, Realized Profit/hour spiked above $20M, signalling a local exhaustion,” it noted in a post on X.
“A pattern consistent since February 2026: Every approach to the $70k–$80K band meets thin liquidity and profit-taking pressure, capping the bounce.”
Pseudonymous trader LP added that Mondays and Thursdays had seen the upper and lower end of the week’s trading range throughout 2026.
“Price pushed higher into Monday, increasing the probability of this pivot forming a weekly high. If the correlation continues to play out, this would suggest Thursday forms the low of the week,” they told X followers.
“Watch price action closely today and tomorrow, it will confirm whether this intra-week pivot resolved as a high or a low.”
Bitcoin trader eyes $71,000 springboard
Continuing, crypto trader Michaël Van de Poppe said the line in sand for bears lay slightly higher than Monday’s current peak.
Related: First real bull signal since 2025? Five things to know in Bitcoin this week
“Pretty strong momentum on the markets of Bitcoin,” he wrote on X about the initial move to $70,000.
“Volatility picking up, and I think it’s fireworks during this week as we might be getting to the end stage of the entire situation in the Strait of Hormuz. If Bitcoin breaks $71K, then markets are in for a test at $80K.”
Van de Poppe further cautioned on following blanket market consensus over new lows coming next.
“Given that all the markets are so oversold at this point, all on-chain indicators are looking overextended and are at similar levels to the bottom areas in 2018, 2020 and 2022, I wouldn’t be surprised that we’re getting a relief run that’s going to turn the sentiment quickly,” he concluded.
This article is produced in accordance with Cointelegraph’s Editorial Policy and is intended for informational purposes only. It does not constitute investment advice or recommendations. All investments and trades carry risk; readers are encouraged to conduct independent research before making any decisions. Cointelegraph makes no guarantees regarding the accuracy or completeness of the information presented, including forward-looking statements, and will not be liable for any loss or damage arising from reliance on this content.
BTC USD price is moving again, at $69,000, it is up by 4% in just a day, bouncing hard off the long-term trendline that has defined every major cycle low since 2017. Before the movement, Strategy’s latest filing reveals that the firm was loading up just before this leg higher, spending $329.9 million in a single week at prices well below current levels.
Michael Saylor’s Strategy added 4,871 BTC to its treasury between late March and early April at an average cost of $67,718 per coin, bringing total holdings to 766,970 BTC acquired for $58.02 billion. The purchase was funded primarily through $227.3 million in STRC preferred stock sales, supplemented by $72 million in common stock proceeds.
At current prices, the full position sits roughly 8% underwater, about $5 billion in unrealized losses, yet the buying continued without hesitation. This conviction, right at a trendline support test, tends to matter.
The broader context makes this accumulation harder to dismiss. Strategy and spot ETFs are now the two dominant institutional absorption channels in a thinning market, with Strategy alone accumulating roughly 44,000 BTC over 30 days through late March.
Discover: The best crypto to diversify your portfolio with
Can BTC USD Price Break $72,000 This Week?
BTC USD is consolidating just below the $72,000 price resistance zone after reclaiming the 100-hour simple moving average. Volume confirmation arrived Monday evening and has held, which is a structurally positive development.
Daily RSI reads 53, MACD(12,26) at 499.5, and ADX(14) at 37.847, all of which point to sustained bullish momentum, though STOCH indicators are flashing overbought.
A daily close above $69,500 opens the path to $72,000 and potentially the $74,000 area that briefly traded in mid-March. Catalyst would be a softer-than-expected US jobs or inflation print, shifting Fed rate expectations.
Or a consolidation between $67,500 and $69,500 for several sessions, as the market digests the bounce, can also happen. Analysts forecast $67,000 by quarter-end, suggesting a range-bound grind before the next directional move.
However, a close below $66,000 and the long-term trendline would invalidate the current setup and expose the $64,000 range.
TradingView analysts noted this week: “A lot of people are turning very bearish on Bitcoin, but I don’t think it’s time to be bearish; the bearish trend is not confirmed.”
Price movement from here will largely depend on macro data and whether ETF inflows accelerate alongside the Strategy’s continued accumulation.
Discover: The best pre-launch token sales
Bitcoin Hyper Targets Early-Mover Upside While BTC Rally
Bitcoin rebounding toward $70,000 is undeniably bullish, but at a $1.4 trillion market cap, the asymmetric upside that characterized 2020 and 2021 is simply getting slimmer. The ship has sailed somewhere under $50,000.
Traders looking for leverage on a Bitcoin bull cycle without the ceiling constraints are increasingly scanning the infrastructure layer, specifically projects that extend Bitcoin’s utility rather than just price-follow it.
Bitcoin Hyper ($HYPER) is one presale generating real traction in that context. Positioned as the first-ever Bitcoin Layer 2 with Solana Virtual Machine (SVM) integration, it targets Bitcoin’s three structural weaknesses directly: slow transactions, high fees, and absent programmability.
The SVM integration is the differentiator; it has a faster performance than Solana itself through extremely low-latency Layer 2 processing, combined with a Decentralized Canonical Bridge for native BTC transfers.
The presale has raised more than $32 million at a current token price of just low $0.013, with staking available at a high 36% APY for early participants.
Research the Bitcoin Hyper presale thoroughly and join the army.
The post BTC USD Price Finally Moving Up: Saylor Strategy Bought More Before The Rally appeared first on Cryptonews.
Polymarket is rolling out its biggest platform upgrade to date, introducing a new stablecoin and rebuilding its trading system.
The changes will take place over the next few weeks and aim to make the platform faster, simpler, and more reliable for users.
At the center of the update is a new collateral token called “Polymarket USD.” It will replace USDC.e and is backed 1:1 by USDC.
For most users, the switch will happen automatically with a one-time approval. However, advanced users and bot traders will need to manually convert their funds.
At the same time, Polymarket is upgrading how trades are placed and matched. The platform is introducing a new order book system and updated smart contracts.
These changes are designed to improve speed, reduce costs, and support more advanced trading activity.
As part of the transition, all existing order books will be cleared, and trading will pause briefly during a scheduled maintenance window. Polymarket said it will announce the exact timing in advance.
For everyday users, the impact will be minimal. The interface will handle most changes in the background. However, traders may notice smoother performance and quicker order execution after the upgrade.
Overall, the update signals a shift in how Polymarket operates. The platform is moving toward a more structured, exchange-like system built for higher trading volume and broader use.
The post Polymarket Launches Stablecoin, Overhauls Trading System appeared first on BeInCrypto.
Figure Technology Solutions, a blockchain-based lending platform that went public last year, may be undervalued at current levels as loan originations accelerate and its tokenized credit marketplace scales, according to Bernstein analysts.
In a report published Monday, Bernstein assigned Figure an “Outperform” rating and a $67 price target — nearly double the stock’s recent trading level of around $32.
The bullish call follows a surge in lending activity. Figure originated $1.2 billion in loans in March, up 33% from the previous month and marking the first time monthly volumes exceeded $1 billion.
The company primarily originates home equity lines of credit (HELOCs), which allow homeowners to borrow against their equity in the property, typically at lower interest rates than unsecured loans.
It uses the Provence blockchain to reduce friction in the loan process which it claims makes it more efficient than traditional lenders. According to Provenance, Figure is able to shave 117 basis points per loan by transacting on the blockchain.
First-quarter originations reached $2.9 billion, more than doubling from a year earlier and defying the usual seasonal slowdown in HELOC demand. The figure is now tracking roughly $12 billion in annualized loan volume.
Figure’s strong start to the year follows a largely positive fourth quarter, where earnings and revenue increased, though profits fell short of expectations.
Related: CoinShares stock makes US debut on Nasdaq following SPAC merger
Figure stock struggles despite strong fundamentals
Despite improving operating performance, Figure shares have fallen more than 20% this year, reflecting broader volatility across digital asset–linked stocks and sector-specific pressures.
The stock has also struggled to regain momentum following its high-profile Nasdaq market debut last September. That closely watched initial public offering valued the company at nearly $800 million.
Still, Bernstein’s analysis valued the company at roughly 25 times its projected 2027 EBITDA — meaning the stock trades at a multiple of its expected earnings before interest, taxes, depreciation and amortization.
This valuation sits above existing digital asset companies, reflecting what analysts describe as Figure’s “structural prospects” as both a tokenization platform and a profitable lending business.
However, risks remain. According to Bernstein, HELOC demand can be sensitive to mortgage refinancing trends, while the broader private credit market — a key pillar of Figure’s growth strategy — has shown signs of increasing pressure.
Related: Crypto Biz: Bitcoin treasuries break ranks as BTC dips below $70K
Crypto has added to a Sunday rally, with bitcoin rising above $70,000 in quiet post-Easter U.S. trading hours.
The gains come alongside a modest advance in the major stock market averages ahead of President Trump’s Tuesday ultimatum for Iran to open the Strait of Hormuz. Just past the noon hour on the East Coast, the Nasdaq is higher by 0.45% and the S&P 500 by 0.3%.
Bitcoin is now higher by nearly 4% over the past 24 hours, with ether, XRP and solana posting similar gains.
Contrarian bitcoin bulls — as bitcoin crashed to $60,000 in early February — first took hope that a bottom was forming, as the strongly no-coiner Financial Times took a victory lap.
The bulls may have been even more pleased over this past weekend by a couple of other bottoming signals. First was the late Friday news that Jeff Park was exiting his role as chief investment officer at ProCap Financial (BRR). Led by Anthony Pompliano, ProCap was among 2025’s hastily formed bitcoin treasury companies aiming to hitch their wagon to the BTC bull market and replicate the success of Michael Saylor’s Strategy.
As with others of the 2025 crop — David Bailey’s Nakamoto (NAKA) and Jack Mallers’ Twenty One Capital (XXI) among them — ProCap stock has struggled mightily, performing far worse for shareholders than bitcoin itself.
Second was well-followed, longtime bull Willy Woo, suggesting that bitcoin could trade sideways for 8 to 12 years from here before finally entering a major bull market.
Other signals of the past couple of weeks: bitcoin miner MARA Holdings unloading more than 15,000 of its bitcoin stack, peer Riot Platforms selling off its entire March BTC production of 3,778 coins, and the aforementioned Nakamoto parting with some its holdings.
Whether the true bottom is in remains to be seen, but the bottoming signs continue to grow.
Key Takeaways
- Appeals court rules federal oversight supersedes state jurisdiction for Kalshi
- CFTC authority confirmed over prediction market contracts
- State gambling regulations blocked from interfering with Kalshi operations
- Decision establishes crucial precedent for U.S. prediction market industry
- Kalshi’s federally-regulated status validated by Third Circuit judges
A federal appeals court delivered a decisive victory for Kalshi, establishing that state regulators cannot enforce gambling restrictions against the prediction market platform. The Third Circuit Court of Appeals determined that Kalshi operates exclusively under Commodity Futures Trading Commission supervision, creating a protective federal shield against conflicting state laws. This watershed moment significantly expands Kalshi’s operational certainty across the nation.
Court Establishes Federal Supremacy Over Prediction Markets
The Third Circuit judges unanimously determined that Kalshi’s event-based contracts constitute federally regulated commodities rather than state-controlled gambling activities. The panel recognized Kalshi’s designation as a contract market under direct CFTC jurisdiction. This classification prevents individual states from applying their gambling statutes to the platform’s offerings.
The court’s analysis centered on the Commodity Exchange Act’s framework, which assigns comprehensive regulatory authority to the CFTC for swap agreements and related financial instruments. Judges found that sports outcome contracts traded on Kalshi qualify as swaps under federal commodity law. This interpretation grants Kalshi immunity from state-level enforcement measures.
The legal challenge originated when multiple state authorities, notably New Jersey, issued cease-and-desist directives targeting Kalshi’s operations. Kalshi contested these actions by asserting that federal regulatory approval preempts state-level prohibitions. The appellate court validated this argument, reinforcing the primacy of federal oversight.
State Regulators Face Jurisdictional Setback
New Jersey’s attorney general contended that Kalshi’s contract offerings violated state gambling prohibitions and operated illegally within state borders. The court dismissed this position, determining that the Commodity Exchange Act explicitly reserves regulatory power for federal authorities. Kalshi successfully defended against potential operational restrictions that threatened its business model.
The majority opinion stressed that Congressional intent clearly established the CFTC as the sole regulator for designated contract markets and swap transactions. According to the ruling, states retain enforcement capabilities only over activities falling outside federal regulatory frameworks. Kalshi’s compliance with CFTC requirements places it firmly within protected federal territory.
A lone dissenting judge raised concerns that Kalshi’s products functionally mirror conventional sports wagering activities. This dissent advocated for preserving state regulatory rights over betting-like offerings. Despite this objection, the prevailing judicial opinion affirmed Kalshi’s status as a legitimate commodities exchange platform.
Implications for the Prediction Market Industry
This judicial determination establishes critical legal foundation for prediction market growth throughout American financial markets. Kalshi now enjoys enhanced regulatory clarity enabling nationwide service expansion without confronting conflicting state requirements. The decision eliminates substantial legal ambiguity that previously clouded federal-state jurisdictional boundaries.
The Commodity Futures Trading Commission has consistently backed Kalshi and comparable platforms when facing state regulatory challenges. Federal regulators have actively opposed state attempts to impose restrictions on CFTC-approved exchanges. This appellate victory provides additional confirmation of Kalshi’s regulatory compliance and legitimacy.
The precedent established by this case will likely shape how emerging prediction market ventures structure their platforms under federal commodity regulations. Kalshi emerges with strengthened competitive positioning and validated legal framework for continued growth. This ruling represents a defining moment for prediction markets’ integration into mainstream financial infrastructure.
A US appeals court sided with Kalshi, ruling that CFTC‑regulated event contracts fall under federal law, not New Jersey gambling rules, reshaping prediction market oversight.
Summary
- U.S. appeals court says New Jersey cannot regulate Kalshi’s CFTC‑supervised sports contracts.
- Ruling strengthens federal preemption and could reshape how prediction markets compete with sportsbooks.
- Decision lands amid a broader legal war between states, Kalshi, and the CFTC over who controls event‑based trading.
A federal appeals court has ruled that New Jersey cannot bar Kalshi from offering sports‑related event contracts in the state, declaring that the Commodity Exchange Act and the Commodity Futures Trading Commission (CFTC) hold exclusive authority over those markets. In a 2‑1 decision, the 3rd U.S. Circuit Court of Appeals in Philadelphia held that trading on Kalshi’s designated contract market is governed by federal derivatives law, not state gambling codes, effectively blocking New Jersey regulators from enforcing their cease‑and‑desist order. The ruling cements a major legal win for Kalshi, which has argued for years that its contracts are swaps and hedging tools rather than traditional sports bets.
The case stems from a series of cease‑and‑desist letters sent by New Jersey in 2025, accusing Kalshi’s sports markets of violating the state’s Sports Wagering Act and constitution and threatening fines of up to $100,000 per violation. Kalshi sued in federal court, claiming that, as a CFTC‑regulated designated contract market, its event contracts sit squarely within federal jurisdiction and are “a type of ‘swap’ regulated by the Commodity Exchange Act.” A New Jersey federal judge had already granted Kalshi a preliminary injunction in 2025, writing that he was “persuaded that Kalshi’s sports‑related event contracts fall within the CFTC’s exclusive jurisdiction,” a view the 3rd Circuit has now largely endorsed.
The appeals court’s opinion aligns with Kalshi’s broader strategy as it fights regulators in multiple states, including Nevada, Maryland, and Tennessee, over whether its markets are illegal gambling or federally protected derivatives. In Tennessee, for example, U.S. District Judge Aleta Trauger recently granted a temporary restraining order halting enforcement of that state’s cease‑and‑desist order, finding that Kalshi is likely to succeed on its argument that federal law preempts state gambling statutes. More broadly, the CFTC and U.S. Department of Justice have escalated the fight by suing Arizona, Connecticut, and Illinois over what CFTC Chair Mike Selig called “aggressive and overzealous attempts to overstep the CFTC” in their efforts to police prediction markets.
Responding to the New Jersey decision, Kalshi co‑founder and CEO Tarek Mansour called the appeals ruling a “significant victory” and argued that regulated prediction markets “offer greater transparency and fairness” than opaque traditional betting channels. In earlier commentary, Mansour has said that prediction markets can outperform conventional financial instruments by delivering “clean, crowd‑driven probabilities instead of noisy headlines,” framing platforms like Kalshi as information infrastructure rather than casinos. The decision also lands as rivals such as Polymarket secure their own CFTC approvals, with the agency “effectively welcoming” Polymarket into the club of fully regulated U.S. exchanges and binding it to full designated‑contract‑market‑style surveillance and self‑regulatory duties.
Despite the 3rd Circuit win, Kalshi’s regulatory risk is far from over. A Nevada judge recently extended a ban preventing the company from offering event‑based contracts in that state, underscoring the fragmented legal landscape facing prediction platforms. At the federal level, a bipartisan group of U.S. senators has floated legislation to ban sports‑bet and casino‑style contracts on CFTC‑regulated prediction markets altogether, raising the prospect that Congress, not just courts, will decide how far companies like Kalshi can push into sports.
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