Are Prediction Markets Legal in New Jersey?
Last verified: 2026-07-15
Unsettled — New Jersey's dispute is in active litigation right now
There is a real legal fight underway involving New Jersey and one or more prediction-market platforms, currently unresolved. Access in New Jersey today reflects the fact that no court has yet ordered platforms to stop operating there.
This is not legal advice. Prediction-market legality is contested and changes quickly. This page reflects publicly reported facts as of the last-verified date above and links to a primary or trade-press source below. Consult a licensed attorney in New Jersey and check each platform's own current state-availability page before trading.
What This Means for Kalshi vs. Polymarket in New Jersey
The dispute in New Jersey is specifically about sports-related contracts (who wins a game, a spread, a player prop) — on both Kalshi and Polymarket. Non-sports contracts (politics, economics, weather, entertainment) from either platform are not the subject of this fight in New Jersey. Kalshi and Polymarket US are both CFTC-regulated exchanges, and neither has a legal advantage over the other in this dispute — state actions in this category name multiple platforms at once, not one company exclusively.
The Full Picture in New Jersey
New Jersey’s Division of Gaming Enforcement issued a cease-and-desist (early 2025); a federal court granted Kalshi a preliminary injunction (Apr. 28, 2025). The Third Circuit affirmed that injunction 2-1 on April 6, 2026 (KalshiEX v. Flaherty), the first federal appellate ruling holding the CEA preempts state gambling law for sports event contracts. Kalshi currently operates in NJ; the state is seeking Supreme Court review (extended filing deadline of Aug. 4, 2026).
Why Is This Even Contested? The Federal-vs-State Fight
Prediction markets sit at the intersection of two legal regimes that currently disagree. Kalshi and Polymarket US register their contracts with the CFTC as swaps or event contracts on a federally designated exchange, and argue that federal law preempts conflicting state gambling law. State gaming regulators counter that sports-related contracts — betting on who wins a game, a point spread, or a player prop — are functionally sports betting, which most states require a separate license to offer. Federal appellate courts are currently split: the Third Circuit ruled for Kalshi on preemption grounds (April 6, 2026), while a federal judge in the Southern District of New York ruled against Kalshi on the same underlying question (July 8, 2026). This is genuinely unresolved law, not a settled "CFTC means legal everywhere" fact — treat any claim that federal registration alone guarantees legality in every state with skepticism.
Dispute is about sports-related event contracts specifically (who wins a game, point spreads, player props). Non-sports event contracts (politics, economics, weather, entertainment) are not the subject of the dispute in this state.
New Jersey-Specific Timeline
Entries from our full regulatory timeline that specifically reference New Jersey.
Nevada and New Jersey issue the first sports-contract cease-and-desist letters
Nevada’s Gaming Control Board and New Jersey’s Division of Gaming Enforcement send cease-and-desist letters to Kalshi (and, in NJ’s case, Robinhood) — the opening moves of the state-vs-platform fight.
Source: Sportico — Kalshi, Robinhood answer C&D ordersFederal court grants Kalshi a preliminary injunction against New Jersey
A federal district court sides with Kalshi against New Jersey’s cease-and-desist — the first ruling in the case that eventually reaches the Third Circuit a year later.
Source: Regulatory Oversight — Kalshi litigation roundupThird Circuit rules for Kalshi on federal preemption (KalshiEX v. Flaherty)
In a 2-1 decision, the Third Circuit affirms Kalshi’s preliminary injunction against New Jersey, holding the Commodity Exchange Act preempts state gambling law for sports event contracts on federally registered exchanges — the first federal appellate ruling on the question. Note: this is a preliminary-injunction ruling (likelihood of success), not a final merits decision, and similar cases remain pending in the Fourth, Sixth, and Ninth Circuits.
Source: Skadden — Third Circuit affirms Kalshi’s injunctionFrequently Asked Questions
Is Kalshi legal in New Jersey?
Is Polymarket legal in New Jersey?
Why is New Jersey disputing prediction market legality?
Where can I check the latest prediction market status for New Jersey?
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