TWO COURTS, OPPOSITE ANSWERS — A JUDGE SAYS A BET IS STILL A BET “EVEN WHEN CALLED BY ANOTHER NAME” — THE SUPREME COURT PETITION IS DUE SEPTEMBER 3

Three judges on the Ninth Circuit ruled on August 28, without dissent, that Kalshi’s sports contracts are not swaps and are not shielded from state gambling law. Judge Ryan D. Nelson wrote the line the whole fight turns on: placing sports bets, “even when called by another name, is still gambling.” The panel added that the contracts “do not help institutions or investors hedge against risk; they create risk, largely for ordinary consumers.” In April the Third Circuit looked at the same product and said the opposite. Two courts, two answers, and New Jersey has until September 3 to ask the Supreme Court to settle it. Robinhood and Crypto.com are in the case too; Nevada has been seeking $120,000 a day. The CFTC’s position is that a contract structured as a swap is a swap no matter what it is about — the same argument that decides whether Hyperliquid’s perpetual futures come onshore. Watch what moved: gambling stocks jumped on the ruling, which tells you what the market thinks these things are. We wrote in August that when compounding died, gambling became the plan. A court just said the quiet part in a published opinion.