CFTC issues order against Kalshi, platform stops election betting

The US Commodity Futures Trading Commission (CFTC) has obtained an administrative stay of the underlying order in its case against Kalshi, which caused the prediction market to halt its trading on the US election less than 24 hours after it began. This development comes as crypto natives continue to have a lot of interest in the US presidential election, which analysts say could have a significant impact on Bitcoin and other cryptocurrencies.

CFTC obtains court order in case against Kalshi

The CFTC obtained an injunction in its case against Kalshi after the appeals court ruled to administratively stay the district court's injunction until it could adequately review the commission's request for a stay pending appeal. U.S. District Judge Jia Cobb had previously ruled in Kalshi's favor, saying the regulator exceeded its authority when it blocked the prediction market from listing election bets.

Following the ruling, the CFTC had asked Judge Cobb to block Kalshi from launching its election trading platform until she released her full opinion to help the commission decide whether to appeal. However, the district judge denied the request, prompting the regulator to file an emergency motion with the appeals court to stay the order because Kalshi had already launched its election markets.

The appeals court's decision to grant a stay of Judge Cobb's order ultimately resulted in Kalshi shutting down its trading market less than 24 hours after it went live. The appeals court found that its decision was not based on the merits of the motion. It also ordered Kalshi to file a response to the emergency motion to help the court decide whether to stay the order pending the outcome of the appeal.

In a letter addressed to the court in which Kalshi opposed the emergency motion, the platform had made it clear that it was ready to respond swiftly if the administrative stay was granted to ensure that the court takes a decision by September 16 or as soon as possible.

The importance of these prediction markets

The CFTC's case against Kalshi is notable because prediction markets have gained traction in the crypto community ahead of the U.S. election in November. Crypto natives are using bettors' sentiments to determine the likely winner in the election between Donald Trump and Kamala Harris. Crypto has also become a major topic ahead of the election, with Trump publicly declaring his support for Bitcoin while Harris remains silent on her position.

With that in mind, analysts have continued to make Bitcoin price predictions depending on who becomes the next US president. Bernstein analysts predicted that BTC price would hit $90,000 if Trump wins, while the leading cryptocurrency could drop to as low as $30,000 if Harris wins.

According to the latest Polymarket data, Harris has a 50 percent chance of becoming the next president, while Trump has a 49 percent chance.

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Boluwatife Adeyemi

Boluwatife Adeyemi is an experienced crypto news writer and editor who has covered topics in DeFi, NFTs, smart contracts, and blockchain interoperability, among others. Boluwatife has a knack for simplifying the most technical concepts and making them easy to understand for crypto newbies. Away from writing, Boluwatife is an avid basketball fan and part-time epee player.

Disclaimer: The content presented may contain the personal opinion of the author and is subject to market conditions. Conduct market research before investing in cryptocurrencies. The author or publication assumes no responsibility for your personal financial loss.