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- Kalshi and Polymarket reached a record $22.2 billion in weekly trading volume, driven primarily by high demand for NFL contracts.
- A coalition of 44 states and the NFL are urging Supreme Court review over CFTC preemption of state gambling laws.
Kalshi and Polymarket posted record NFL-season trading volume last weekend, sharpening a legal and regulatory fight over whether sports prediction markets should be treated like traditional sports betting.
The dispute matters because these federally regulated exchanges can operate under a different framework than state-licensed sportsbooks. If courts ultimately side with states, prediction markets could face state gambling rules, taxes, and licensing requirements. If the federal framework holds, they may keep operating nationwide under Commodity Futures Trading Commission oversight.
According to the source report, Kalshi and Polymarket handled a combined $8.56 billion in trading volume over two days last weekend and $22.2 billion for the week, both records cited from Dune Analytics. More than 80% of Kalshi’s September volume came from sports trades.
Sports contracts are driving the growth
Sports trading now appears to be the main growth engine for the category. The report said combo products made up 65% of Kalshi’s volume and 53% of Polymarket’s U.S. volume last week, with most of those combinations tied to sports.
On days with major NFL and college football action, Kalshi’s combo volume averages about $1.36 billion, according to Piper Sandler estimates cited in the report. That compares with $900 million in combo volume over the entire previous NFL regular season.
The growth is also drawing in established sportsbook companies. DraftKings and FanDuel are launching prediction-market products to reach customers in states where their sportsbooks cannot operate, the report said.
Citizens Financial Group analyst Jordan Bender told Yahoo Finance, “It’s the same playbook we saw five years ago with online betting apps,” adding, “It looks no different.”
Courts could determine whether states or federal regulators control the market
The central legal question is whether sports event contracts listed by prediction markets are federally permitted exchange products or illegal gambling under state law. The report said at least 44 states argue the contracts are illegal gambling subject to state regulation.
The CFTC has sued states that tried to enforce gambling laws against federally regulated exchanges. At the same time, the NFL has asked for Supreme Court intervention, describing the CFTC’s approach as “laissez-faire.” Federal appeals courts have split on the issue, which the report said increases the odds of Supreme Court review.
The stakes are high for both exchanges and sportsbooks. Seton Hall law professor Ilya Beylin told Yahoo Finance that in states such as Texas and California, where gambling is not allowed, prediction markets “have a leg up.” Indiana University business law professor John Holden said that if prediction markets prevail at the Supreme Court, “the sports betting regulatory regime as it exists could basically cease to exist.”
The report also noted consumer-risk questions. A Bloomberg News analysis cited in the story found that money staked on “yes” longshots lost 15% by settlement on Kalshi and 27% on Polymarket since early 2025, before fees.
Source: As reported by María Paula Mijares Torres.
