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Comment by esalman | Hacker News Reader

Sports gambling is controlled by FTC in the US. Prediction markets like Kalshi and Polymarket found a loophole where they can run gambling operations under CFTC and and not be controlled by FTC. There needs to be some legislative actions from the Congress to close the loophole.

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> Congress to close the loophole

But i think one of the prediction markets more important uses is to enable insider trading for the current administration.

It's a lazy argument imo. As corrupt as they might be there is way more money to make in the stock market or bond market if you have insider info. There is little reason for them to go after peanuts in the prediction markets.

I don't entirely agree. There's an angle on the "if corrupt, who cares?" but the stock and bond market have orders of magnitude more oversight and (potential) consequences than the risks and consequences of insider trading on the prediction markets.

Nothing needs to be done, Kalshi has no loophole. The Ninth Circuit ruled on exactly this last week.

Incorrect. Ninth circuit ruled in favor of Nevada State, but earlier this year third circuit ruled in favor of Kalshi. So it's going to the Supreme Court.

All of the above is completely independent from what Congress can or cannot do.

The third circuit's opinion is poorly reasoned and its not binding precedent in California anyway, which can now regulate Kalshi because the ninth circuit's decision is binding precedent in California. Congress does not need to do anything, the law is clear that states can regulate gambling. The thought that Congress needs to address that is preposterous. They'll go through to same song and dance in the second circuit too - want to make a bet on how that'll turn out?

What are the odds on the prediction market that this will happen?

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