Appeals court greenlights betting on congressional elections

A federal appeals court on Wednesday refused to block a lower-court ruling allowing Americans to bet on the outcome of the 2024 congressional elections.

The appeals court rejected an effort by the federal Commodity Futures Trading Commission to prohibit the commodities exchange KalshiEx from offering “Congressional Control Contracts” while the CFTC appealed the lower court’s ruling giving the green light for such bets.

The CFTC “has failed to at this time to demonstrate that it or the public will be irreparably injured” without a stay on the contracts being offered during the appeal, wrote Judge Patricia Millett of the U.S. Appeals Court for the District of Columbia Circuit.

Millett, who was part of a three-judge panel hearing the case, said the agency could renew its bid to block the contracts “should substantiating evidence arise.”

There were no dissents on Wednesday’s decision.

The CFTC had barred KalshiEx from listing its congressional contracts on the exchange, which the commission regulates, on the ground that they would violate the laws of many states that ban gambling on elections.

But a judge in U.S. District Court in Washington, D.C., ruled last month that the CFTC had erred in finding that KalshiEx’s congressional contracts involved gaming or gambling.

That ruling was in effect for only about eight hours before the D.C. appeals court stayed it at the request of the CFTC.

That administrative stay was lifted in Wednesday’s ruling.

CNBC has requested comment from the CFTC and KalshiEx.

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