New York has sued prediction market platform Kalshi, alleging it operates an illegal, unlicensed gambling business by offering event contracts on sports, elections and other outcomes.

The lawsuit seeks to stop Kalshi’s alleged illegal gambling operation in the state, require the company to forfeit illegal gains, pay restitution to users and pay civil penalties equal to three times those gains.

“No matter what they call themselves, prediction markets like Kalshi are gambling platforms, plain and simple,” Attorney General Letitia James said in Friday’s statement. “We are taking them to court to uphold our laws and protect New Yorkers.”

The lawsuit comes after the New York State Gaming Commission issued Kalshi a cease-and-desist order in October 2025, prompting the company to sue the regulator in federal court. 

A judge denied Kalshi’s request for a preliminary injunction in July, and an appeals court later rejected its bid to block enforcement while the appeal proceeds.

Kalshi did not immediately respond to Cointelegraph’s request for comment.

CFTC defends federal oversight of prediction markets

The lawsuit adds to an escalating jurisdictional dispute over whether event contracts offered by federally regulated prediction markets are subject to state gambling laws.

Just before New York filed its case, the Commodity Futures Trading Commission (CFTC) filed an emergency motion seeking to block New York’s enforcement efforts, arguing that the state’s actions interfere with the agency’s exclusive authority under the Commodity Exchange Act to regulate designated contract markets like Kalshi.

Related: CFTC issues second warning to prediction markets on cookie-cutter self-certifications

The CFTC has taken similar positions in disputes involving at least nine states, arguing that allowing states to prohibit event contracts listed by federally regulated exchanges would create conflicting state rules and undermine federal commodities regulation.

Prediction markets continue to gain mainstream traction

Prediction markets allow users to buy and sell contracts tied to the outcome of future events, with prices reflecting the market’s estimate of the probability that an event will occur.

Kalshi’s rival, Polymarket, has also faced regulatory scrutiny, with several countries restricting or investigating its operations over gambling and licensing concerns.

Kalshi began expanding into blockchain-based infrastructure in December 2025, launching tokenized prediction markets on Solana and later adding support for multiple blockchain networks.

The broader prediction market sector has also grown alongside major sporting events.

According to analytics firm Chainalysis, blockchain-based prediction markets processed about $20 billion in trading tied to the 2026 FIFA World Cup, with more than 400,000 wallets participating.

Magazine: The 100x obsession: Fundamentals grow in importance as crypto matures

The crypto market is closing out July on the back foot, with bitcoin BTC$63,893.92 falling 1.31% since midnight UTC to $63,870 and ether (ETH) dropping 1.40% to $1,890 after struggling to regain the $2,000 level it touched earlier this month.

The performance is diverging from equities, with South Korea’s Kospi surging by more than 15%. Nasdaq 100 and S&P 500 index futures are also in the green.

The conflict in the Middle East and hawkish comments from the Federal Reserve committee have dented crypto’s recovery hopes this week. The CoinDesk 20 Index has dropped 2.34% since midnight Monday, though with a gain of 8.7% since June, it’s still positive for the first month in three and by the most in a year.

Derivatives positioning

• Taker long-short futures volume ratio: As the market wilts, the taker long-short futures market volume ratio continues to lean bearish, suggesting a downside bias. A taker is a market participant who executes an order immediately against an existing order in the book.
• XRP futures open interest rises: XRP’s futures open interest (OI) rose further, extending the three-week upswing to 2.27 billion tokens, the most since late June. The token’s price has declined to $1.07 from $1.13 during the period. A combination of a drop in price alongside a rise in OI is said to confirm the downtrend, a sign traders are shorting the market in anticipation of a deeper price drop.
• BTC in stasis: BTC’s OI remains static at around 750K, as it has all month. That’s a sign traders are unwilling to deploy capital in leveraged products despite signs of stability in the market. It’s no surprise that BTC’s early month bounce from under $58K has stalled in the $62K to $65K range. It’s the same story for ether and Solana.
• UNI’s OI growth: Uniswap’s UNI token is the OI growth leader for the third straight day, rising to 75.80 million UNI, a level last seen Feb. 14. This is a clear sign of investors willing to take on risk in tokens backed by positive newsflow. Recently, BlackRock decided to debut its tokenized Treasury fund on Uniswap.
• Negative cumulative volume delta: Most major tokens, including UNI, have negative 24-hour OI-adjusted cumulative volume delta, a feature consistently observed during sharp downtrends over the past year. A negative CVD means traders are shorting more at market orders than passive limit orders. In other words, bears are being more aggressive.
• Bitcoin implied volatility: Bitcoin’s BVIV, the 30-day implied volatility index, fell to 37%, the lowest since May. These levels have served as floors in recent years, bringing about a bounce in the so-called fear index. Since ETFs debuted in 2024, the BTC price correlation with the BVIV has been negative, meaning any bounce in the BVIV could be accompanied by a fresh decline in the spot price.
• Options open interest: On Deribit, bitcoin and ether options worth $10 billion expired early today. Now the distribution of open interest in remaining expiries that extend all the way to June 2027 shows a $60,000 put as the most popular bet. A put represents a bearish bet on the market.

Token talk

• Uniswap (UNI) was Friday’s standout performing altcoin, rising by 9.30% over 24 hours to $4.41 as it sustains momentum from its Robinhood layer-2 integration announced earlier this month.
• Ethena (ENA) extended its recovery, rising 1.23% since midnight UTC and 4.31% over 24 hours to $0.082, with the token now up significantly from its July lows. Keep in mind it’s still more than 90% below its all-time high.
• Lighter (LIT) fell a further 2.28% as the correction from its July peak deepened, with the token now 20% below the highs it set earlier this month after its 200% rally between May and early July.
• Zcash (ZEC) gave back 2.15% to $459 after a strong run earlier in the week, with the privacy coin sector losing ground on Friday.
• ADA$0.1702 added 0.94% since midnight and 4.09% over 24 hours, quietly extending a recovery that has seen it claw back after June’s 45% plunge.

• Bybit’s new simulator previews both Dual Asset settlement outcomes clearly.
• Redesigned interface reduces steps needed to compare terms and place orders.
• VIP-tier products with enhanced APR rates open to all users every Friday.

Bybit said on Friday that it had upgraded its Dual Asset product with a new investment simulator, a simplified interface and broader access to products carrying VIP-tier annual percentage rates.

The Dubai-based company, which describes itself as the world’s second-largest cryptocurrency exchange by trading volume, said the changes are intended to make the short-term structured investment product easier to understand and use.

Bybit Dual Asset is a non-principal-protected product that allows users to set a target price for buying or selling cryptocurrency.

Investors earn APR rewards on their principal at settlement, regardless of whether the selected target price is reached.

A simulator for settlement outcomes

The main addition is a simulator that lets users preview potential outcomes before placing an order. Traders can choose a token from a searchable list, enter their investment amount and select from the available durations.

The tool displays the two possible settlement scenarios side by side in a single illustration, giving users a clearer view of the product’s possible outcomes.

A “Match My Assets” filter also highlights coins based on a user’s existing holdings.

Bybit said this feature is designed to make product selection more efficient. Users can reach the simulator by switching on “Beginner Mode” under “Choose Product Plan”.

The company has also redesigned the wider Dual Asset interface. The updated layout reduces the number of steps needed to compare product terms and place an order.

VIP products open to all on Fridays

Bybit is also expanding access to Dual Asset products previously limited to VIP customers. Every Friday, all users will be able to access selected VIP-exclusive products with enhanced APR rates without holding a VIP membership.

The weekly access window extends the higher-rate offering to a broader section of the exchange’s user base while retaining the existing product structure.

Bybit said users can earn a competitive yield when a target trade is executed, settling at the preset price while also receiving APR rewards.

The product may also allow users to buy at a lower price or sell at a higher price than through a direct trade when the target price is reached.

When the target is not triggered, users receive their principal back together with the APR rewards accrued during the investment period.

The company noted, however, that the product remains non-principal-protected and that terms, eligibility requirements and potential restrictions apply.

Real-world asset (RWA) perpetual futures are starting to look less like a side experiment and more like a meaningful part of crypto derivatives. Data shared by Talos indicates that, over the past week, trading volume in RWA-linked perpetuals on major venues came close to Bitcoin perpetuals—an outcome that underscores how quickly tokenized finance is finding a home in onchain markets.

Talos estimates that tracked seven-day volume across RWA perps reached $61.7 billion as of a Thursday snapshot, equivalent to 99.2% of Bitcoin perpetual volume on Hyperliquid and Binance, the two venues where most of the activity is concentrated. Equity-linked contracts made up the largest share at 57.8%, followed by commodities at 28.2%.

Key takeaways

• RWA perpetuals nearly match Bitcoin perpetuals—tracked seven-day RWA perp volume was $61.7 billion, or 99.2% of Bitcoin perp volume on Hyperliquid and Binance.
• Equities dominate the RWA mix, accounting for 57.8% of RWA perp volume, while commodities represent 28.2%.
• Hyperliquid leads the category, reporting $25.1 billion in RWA perpetual trading volume for July 13–19.
• Tokenized RWA activity is expanding beyond trading, with onchain RWA value cited at about $36.8 billion excluding stablecoins (per RWA.xyz).
• RWA perps still remain a fraction of overall derivatives, with tracked RWA perpetuals at roughly 7.5% of total futures volume over the same seven-day period.

RWA perpetuals surge toward parity with Bitcoin derivatives

The acceleration in RWA perpetual futures is notable because it reflects demand for tradable exposure to tokenized assets—equities, commodities, and other instruments—using the same core mechanics that have driven much of crypto’s derivatives growth.

According to Talos, the combined seven-day volume of tracked RWA perps was $61.7 billion, representing 99.2% of Bitcoin perpetual volume across Hyperliquid and Binance. The breakdown highlights that traders have leaned most heavily into tokenized equity exposure, with 57.8% of the RWA perp tally linked to equity contracts. Commodities accounted for 28.2% of volume, while the remainder came from other categories including indexes.

Talos also frames the activity as broadly aligned with the current market concentration: Hyperliquid and Binance capture the majority of perp trading for these instruments, making them the key venues to watch for continued RWA derivatives traction.

Hyperliquid posts a clear lead as RWA contracts diversify

Venue-level data further clarifies where liquidity is forming. Hyperliquid recorded $25.1 billion in RWA perpetual trading volume during the week of July 13 to July 19—more than the combined volume of all other perpetual categories on its platform during that period, based on Talos’ reporting.

That performance is consistent with a broader narrative from market participants who argue onchain perpetuals offer structural advantages over traditional, expiry-based products. Pantera Capital previously suggested that perpetual futures could evolve into a dominant trading instrument beyond crypto, pointing to factors such as 24/7 trading, the absence of contract expiries, easier position management, and continuous price discovery (earlier coverage referenced by the article).

As for the composition during the early days of the current week, Talos’ dashboard shows RWA perpetual trading volume already at $37.2 billion, exceeding Bitcoin perpetual volume by about 9%. In that same snapshot, equity-linked contracts were $22.8 billion, commodities were $9.1 billion, and indexes were $4.2 billion. ETFs contributed about $338 million, while foreign exchange, pre-IPO, and other RWA contracts made up the remainder.

Why traders and platforms are leaning into tokenized assets

Beyond the perps themselves, the ecosystem backdrop also matters. The article cites RWA.xyz for the claim that the value of onchain RWAs has grown to about $36.8 billion, excluding stablecoins. While that figure is separate from derivatives volume, it provides context for why tokenized instruments are becoming more frequently used in trading strategies rather than simply being held or settled.

Crypto exchanges are also expanding past “pure” crypto listings, increasingly offering tokenized stocks and commodities alongside digital assets. This kind of product expansion can reduce friction for mainstream participants—particularly those already familiar with equity and commodity exposure—while also giving crypto-native traders additional instruments to hedge, speculate, or rotate into.

Circle co-founder and CEO Jeremy Allaire tied this momentum to a market narrative shift in an X post dated July 24, suggesting that rising RWA trading on Hyperliquid indicates crypto markets are moving “away from speculating on endogenous digital commodities.” While that framing is opinion, it aligns with the measurable trend Talos reports: RWA-linked perp activity is large enough to meaningfully compete with the scale of Bitcoin perpetuals on major venues.

Regulatory pressure and the “24/7” question for traditional markets

As onchain perpetuals grow in importance, traditional finance is starting to engage more directly with how regulation should treat blockchain-based markets. Intercontinental Exchange CEO Jeffrey Sprecher, whose company owns the New York Stock Exchange, has urged regulators to create a “level playing field” for 24/7 onchain perpetual futures—arguing that market structure should not block development of blockchain-based trading (referenced by the article’s link).

The central tension is that perpetual futures are built around continuous trading and perpetual exposure, while many legacy market products are tied to standardized trading sessions and defined product mechanics. If onchain platforms continue to deepen liquidity in tokenized instruments, regulators may face increasing pressure to define how such venues and products should be supervised, including issues around participant access, disclosures, and market integrity.

That said, Talos’ figures also imply that RWA perpetuals are still early relative to the full derivatives universe. The article states that aggregate futures trading volume across tracked platforms was about $821.4 billion over the past seven days, with tracked RWA perpetuals accounting for roughly 7.5% of that total—large enough to matter, but not yet dominant.

Going forward, traders and builders should watch whether weekly RWA perp volume can sustain the momentum indicated by Talos’ early-week snapshot (already $37.2 billion, ahead of Bitcoin perps by about 9%) and whether Hyperliquid’s outsized RWA activity persists as more venues potentially deepen liquidity. The bigger question for the market is whether RWA derivatives continue to move from experimental exposure into a durable, mainstream trading category—especially as regulators decide how to handle 24/7 onchain perpetual futures.