This week’s prediction markets headline was undoubtedly the Commodity Futures Trading Commission (CFTC) issuing an emergency declaration that ordered Kalshi to defy New York and continue offering event contracts in the Empire State, in the face of the state’s $36bn lawsuit against the company.
Other developments of note happened in the last few days as well. Every Friday, SBC Americas rounds up some of the other prediction markets stories you might have missed.
Flight data company sues Kalshi, then un-sues
Kalshi causing a stir is hardly groundbreaking, nor is Kalshi prompting a lawsuit. But this week’s furor involving flight tracking data firm FlightAware was something a little different.
A lot happened in the space of around 24 hours. FlightAware sued in New York federal court on Monday, accusing Kalshi of breach of contract and trademark infringement, among other claims. The complaint related to flight-cancelation markets that apparently used FlightAware’s data to settle the wagers. FlightAware alleged that, despite the fact that it sent cease-and-desist letters to Kalshi, the firm continued to use its registered trademark and data.
The Wall Street Journal reported that Kalshi added a disclaimer that its markets were not endorsed by FlightAware.
Then, on Tuesday evening, news broke that FlightAware voluntarily dismissed its own lawsuit, which sought an injunction and damages, without prejudice. Attorney Ariel Givner speculated that the two companies likely worked out things out of court.
One Kalshi lawsuit down, innumerable others remain.
Novig goes on lawsuit spree
We reported that newly anointed prediction markets operator Novig sued the state of New York. Well, that was just the start.
Within a week of launching nationwide as a prediction market, the former betting exchange and short-lived sweepstakes gaming platform filed federal lawsuits in four separate states:
- Massachusetts
- New Mexico
- New York
- Washington
Each of those states have filed in court seeking relief against prediction markets. Novig has asked the courts for preliminary injunctions against all four of them.
Novig gained CFTC approval to operate as a designated contract market (DCM) on June 16, and launched its sports-focused prediction markets platform in 47 states on Aug. 4.
Nevada follows Michigan in cutting ties with NCPG
In early July, the Michigan Gaming Control Board (MGCB) wrote to the National Council on Problem Gambling (NCPG) to state that it was withdrawing its membership as a result of the council’s partnership with Kalshi.
This week, the Nevada Current reported that the Nevada Council on Problem Gambling also intends to formally sever ties with the council. Kalshi has been banned via court order from offering its sports prediction markets in both Michigan and Nevada.
Nevada Council Executive Director Trey Delap told the local media outlet that the state council raised its concerns with NCPG leadership. “After months of discussion, we’ve concluded that this is not simply a disagreement about one company,” Delap added. “It reflects a fundamental difference in how we believe a problem gambling organization should respond to emerging gambling risks.”
NCPG Director of Pubic Affairs Cait Huble told SBC Americas in July that the national council holds “a neutral position” on legal gambling, and that membership or partnership does not constitute endorsement or influence NCPG’s operations or policy positions.
CFTC puts PMs on Innovation Advisory Committee agenda
The CFTC confirmed that the inaugural meeting of its new Innovation Advisory Committee on Aug. 20 is likely to include at least some discussion of prediction markets.
An agenda for the three-session meeting shared on Thursday suggests that among the topics of the third session might be “The Evolution of Prediction Markets” as well as the roles of federal and state regulatory perspectives, and other areas. That could include discussion of the growth of event contracts, the ongoing litigation around the products, and manipulation concerns.
The CFTC unveiled its Innovation Advisory Committee in February. It consists of dozens of members, including the CEOs of big-name prediction market and gambling operators such as:
- CME Group CEO and Chair Terry Duffy
- Coinbase CEO Brian Armstrong
- Crypto.com CEO Kris Marszalek
- DraftKings CEO Jason Robins
- Fanatics CEO Matt King
- FanDuel CEO Christian Genetski
- Kalshi CEO Tarek Mansour
- Polymarket CEO Shayne Coplan
- Robinhood CEO Vlad Tenev
California tribe ducks out of Kalshi lawsuit
It’s not only states and flight data company firms that are in court battling Kalshi. But one California tribe this week left a federal court case against the platform.
The U.S. District Court for the Northern District of California approved the dismissal of the Picayune Rancheria of the Chukchansi Indians from a lawsuit filed last year. The Chukchansi Indians sued Kalshi alongside Blue Lake Rancheria and the Chicken Ranch Rancheria of Me-Wuk Indians seeking injunctive relief and fiscal damages.
The three comparatively small California tribes allege Kalshi offers illegal gaming on tribal lands in what they argue constitutes a violation of the Indian Gaming Regulatory Act. A judge denied the tribes’ motion for a preliminary injunction last November and the ase now lies in the U.S. Circuit Court of Appeals for the Ninth Circuit.
Fliff joins list of sweeps-to-predictions pivots
While Novig goes on a court offensive against states, the flurry of sweepstakes operators moving to transition to the prediction markets space continues.
Along with Novig and ProphetX, which are now registered DCMs with the CFTC, longstanding sweeps sportsbook platform Fliff is pushing into the space. The company has pending registrations with the National Futures Association (NFA) to become a futures commission merchant (FCM) and an introducing broker (IB) as of Aug. 12. That would allow it to accept customer orders for event contract trades, although not to host markets on its own exchange.
While sports prediction markets remain enshrouded in legal uncertainty pending various court cases, the path narrowed on sweepstakes gaming over the last 18 months. Numerous states banned the vertical in 2025 and 2026, and several companies seem to be deciding that, at least for now, the grass is greener elsewhere.
DraftKings files to ramp up Combos offering
DraftKings co-founder and CEO Jason Robins exuded enthusiasm about DraftKings Predictions on last week’s earnings call, noting that its rollout has “far surpassed our expectations,” with more than 600,000 engaging customers in the first half of 2026. He also called out the company’s parlay-style Combos markets as a big success story.
Well, DraftKings recently filed with the CFTC to self-certify various new sports event contracts to offer on its in-house DKeX prediction markets exchange, including an expansion of its Combos slate. The operator also self-certified numerous new categories of football contracts ahead of the upcoming NFL season.
“Our expectation is that the vast majority of our sports content, at least in the major sports that are going on this fall, starting with CFB and NFL, we’re going to try to port as much of that volume over to the [DKeX] exchange as fast as is reasonably possible,” Robins said last week.
