A federal judge granted a partial preliminary injunction to Kalshi and Coinbase in Illinois on October 2, 2026, finding that the state’s licensing requirements, including provisions under 230 ILCS 45, likely conflict with the federal Commodity Exchange Act. Judge Martha M. Pacold sided with the companies and the Commodity Futures Trading Commission, concluding that sports event contracts may qualify as swaps under federal jurisdiction rather than state gambling law. The question of transaction fees remains unresolved, with the judge requesting further briefing on that issue. The two companies, joined by the federal regulator as co-plaintiff, have been challenging Illinois authority since Kalshi launched sports contracts in January 2025 and Coinbase partnered with them in December 2025. This ruling is part of a broader legal battle across multiple states over the classification of sports-related contracts.
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