ProphetXLegal
Where are ProphetX’s event contracts available? 2 states with a case, tracked
Last checked against court dockets and filings · Updated
As of Oct 30, 2026, no order we found has switched off any ProphetX event contracts and in 2 states a lawsuit or regulator’s action is live with nothing switched off. Each is checked against its docket and filings. States that have acted say their gambling law applies, and ProphetX LLC is a CFTC-designated contract market: a licensing dispute, not a tax ruling, and with no IRS guidance people file event contracts three common ways.
By Owen Monagan, Founder & CEOUpdated
Map
Every state, dated.
Every state sits in one of four groups. Select a state for where it stands and the filing behind it.
ProphetX is run by ProphetX LLC, a CFTC-designated contract market. Where a state order is in force, some kinds of market can be switched off for anyone located in that state while the rest keep trading.
ProphetX, state by state
As of Oct 30, 2026Connecticut
Being foughtIn September 2026 Connecticut named ProphetX among nine prediction markets it ordered to stop offering sports contracts to residents. We have not seen the order itself, and we found no court order naming ProphetX.
- Switched off
- 0
- A court order is in force. ProphetX has to block these markets for anyone in the state.
- Ordered, on hold
- 0
- A court ordered a block, then paused it during the appeal. You can still trade here today.
- Being fought
- 2
- A lawsuit, ruling or cease-and-desist is live, but nothing is switched off.
- No action found
- 49
- We found no order, lawsuit or cease-and-desist against ProphetX here.
ProphetX event contracts, state by state. ProphetX LLC is the company the CFTC designated a contract market on June 11, 2026. Each action below says which company it names. What a court or regulator has actually done, as it stands on the date above. Tiles are equal in size so a small state reads as clearly as a large one. The state list below holds the same data as text.
What changedSince Oct 30, 2026
ProphetX cases: what changed since Oct 30, 2026?
No change for ProphetX since Oct 2, 2026. The last one is below. Last checked Oct 30, 2026.
- Nothing changes for accounts yetOhio’s Casino Control Commission sent ProphetX a cease-and-desist letter on sports event contracts. Filing
Lawsuits2 actions
What states have sued ProphetX?
As of Oct 30, 2026, no states have taken ProphetX to court. Two other things also get called suing ProphetX, and only an order in force switches anything off.
- 01A state or city suesAn attorney general, a gaming regulator or a city goes to court. Only an order in force switches anything off.
- 02ProphetX sues the state firstProphetX asks a federal court to stop a state’s officials enforcing state gambling law against it.
- 03A regulator acts on its ownA cease-and-desist letter or order, or a proposed fine. None of these switches anything off by itself.
| Date | State | Action | Status now | Filing |
|---|---|---|---|---|
| Sep 2026 | Connecticut | Cease-and-desist. Connecticut Department of Consumer Protection: One of nine cease-and-desist orders to prediction markets announced by the governor’s office, which lists ProphetX. | Being fought | Filing |
| Oct 2, 2026 | Ohio | Cease-and-desist. Ohio Casino Control Commission: Cease-and-desist letter to Prophet X: stop offering sports event contracts in Ohio and confirm in writing within fourteen days. | Being fought | Filing |
Where ProphetX went to court first
| State | Case | Docket |
|---|
Whether federal commodities law preempts state gambling law is being argued in suits by venues, states and the CFTC. Prediction market legal status by state sets every venue’s cases side by side.
Your money
What these orders mean for your account.
An order stops new trades in the markets it covers. Where an order or agreement also sets terms for open positions or cash, the state’s row quotes it.
Wherever you are
Courts
Where the courts stand on ProphetX.
Whether federal commodities law preempts state gambling law is unresolved. Each federal appeals court with a ProphetX case, and the Supreme Court dates ahead.
| Court | Ruling | Where it stands | Source |
|---|---|---|---|
| Third CircuitDE, NJ, PA | For ProphetX | Ruled for Kalshi: it is likely to succeed in showing that federal law preempts New Jersey's ban on its sports contracts. (Apr 6, 2026) | Opinion |
| Ninth CircuitAK, AZ, CA, HI, ID, MT, NV, OR, WA | For the states | Ruled for Nevada: sports contracts likely aren't swaps, so states can enforce. Kalshi has asked the full court to rehear the case. (Aug 28, 2026) | Opinion |
| Fourth CircuitMD, NC, SC, VA, WV | No decision yet | Heard Maryland's case May 7, 2026. No decision yet. | Docket |
| Sixth CircuitKY, MI, OH, TN | For the states | Ruled for Ohio and Tennessee: Kalshi hasn't shown its sports contracts are swaps, and even if they were, federal commodities law doesn't preempt the states' gambling laws. Kalshi asked the full court to rehear on Oct 9, 2026. (Sep 25, 2026) | Opinion |
| Tenth CircuitCO, KS, NM, OK, UT, WY | No decision yet | Refused on Sep 8, 2026 to pause Utah's win while Kalshi appeals. The appeal itself is pending. | Docket |
| Second CircuitCT, NY, VT | No decision yet | Hearing Kalshi's appeals from New York (No. 26-1835) and Connecticut (No. 26-2239) in tandem. New York's brief is due Oct 30, 2026. | Docket |
| Seventh CircuitIL, IN, WI | No decision yet | No ruling on Kalshi yet. Appeals from the CFTC's suit against Wisconsin were docketed in August 2026. | Docket |
| Eighth CircuitAR, IA, MN, MO, NE, ND, SD | No decision yet | Kalshi appealed Iowa's win on Sep 15, 2026 (No. 26-2874). No decision yet. | Docket |
ProphetX at the Supreme Court
Who gets to regulate sports contracts on a federally registered exchange: only the federal regulator, or the states too? The Court is being asked whether federal commodities law preempts state gambling laws, not whether anyone must stop, and not how the trades are taxed.
- No. 26-299Filed Sep 2, 2026Flaherty v. KalshiEXNew Jersey (state gaming regulators). From the Third Circuit, No. 25-1922, which ruled for Kalshi on Apr 6, 2026.Kalshi's response is due Nov 9, 2026, extended at Kalshi's request from Oct 8. On Oct 29 Kalshi asked for a further extension to Dec 7, which New Jersey does not oppose; the Court had not ruled on it when we checked. Briefs backing New Jersey's side have come from Ohio, 38 other states and the District of Columbia (Oct 7), and more amicus briefs followed on Oct 8, including from the NFL, the American Gaming Association and 145 tribes.Docket
- No. 26-338Filed Sep 10, 2026Robinhood Derivatives v. DreitzerRobinhood (a broker offering Kalshi's contracts). From the Ninth Circuit, No. 25-7831, which ruled for Nevada on Aug 28, 2026.Nevada's response is due Nov 13, 2026, extended from Oct 14.Docket
- No. 26-344Filed Sep 11, 2026North American Derivatives Exchange v. NevadaCrypto.com (another exchange). From the Ninth Circuit, No. 25-7187, which ruled for Nevada on Aug 28, 2026.Nevada's response is due Nov 16, 2026, extended at Nevada's request from Oct 15.Docket
ProphetX case dates ahead
Why there is more than one way to file
Federal appeals courts are split over whether these contracts are gambling that a state can license or exchange products that only the CFTC regulates. A ruling on state licensing is not a tax ruling, and the IRS has issued no guidance on event contracts. Because no court or agency has settled what these contracts are, people file them more than one way. Of the people we’ve seen file, these are the three most common ways, and Realize supports each of them. The same trades can be priced under each route, side by side.
| Route | Form | What it does |
|---|---|---|
| Gambling income, section 165(d) | Schedule 1; losses on Schedule A | Winnings are reported in full. Losses can be deducted only if you itemize, at 90% of losses and capped at winnings (tax years beginning after Dec 31, 2025). |
| Standard capital gains | Form 8949 and Schedule D | Each closed contract is a sale. Gain or loss is short or long term by holding period, and net losses can offset other gains. |
| Section 1256 | Form 6781 | 60% of the net gain or loss is treated as long term and 40% as short term. Open positions are marked to market at year end, and a net loss can be carried back three years. |
How prediction market trades are taxedEvery prediction-market case, by court and state
Kalshi’s Supreme Court tracker follows the petitions asking whether federal commodities law preempts state gambling law.
State by state2 states with a case
Every state with a ProphetX case.
Each state with a case, in its group as of Oct 30, 2026. Every filing behind them is in the sources below.
| State | Group | Where it stands |
|---|---|---|
| Connecticut | Being fought | In September 2026 Connecticut named ProphetX among nine prediction markets it ordered to stop offering sports contracts to residents. We have not seen the order itself, and we found no court order naming ProphetX. |
| Ohio | Being fought | Ohio’s Casino Control Commission sent ProphetX a cease-and-desist letter in October 2026. A letter is not a court order, and we found no court order naming ProphetX in Ohio. |
Questions4 questions
Questions people ask about ProphetX’s legal status.
Short answers, from the status file as of Oct 30, 2026.
Is ProphetX legal in my state?
As of Oct 30, 2026, ProphetX faces a lawsuit, order or cease-and-desist in 2 states. In the other 2 states with a case, nothing is switched off, and in every state not listed we found no order, lawsuit or cease-and-desist.
Which states have sued ProphetX?
As of Oct 30, 2026, no state has sued ProphetX; every action against it is listed by state above.
Has the Supreme Court taken a ProphetX case?
Not as of Oct 30, 2026. Three petitions ask it whether federal commodities law preempts state gambling law, and none has been granted. The next date on the docket is Nov 9, 2026: Kalshi's response to New Jersey's petition is due.
How current is this page?
We check ProphetX’s cases against court dockets and filings, and the last check was Oct 30, 2026. Changes since Oct 30, 2026 are listed newest first, each with the filing it comes from, so you can read the docket yourself.
Sources14 documents
Where each status comes from.
Primary documents first, each with the date we last read it. Where we keep a copy of a filing, it is linked beside the original.
- Connecticut governor’s office release, “Governor Lamont announces new actions against illegal prediction markets offering sports wagers in Connecticut” Connecticut Governor · Checked October 30, 2026
- Ohio Casino Control Commission, cease-and-desist letter to Prophet X Ohio Casino Control Commission · Checked October 30, 2026Our copy
- CFTC, Order of Designation: In the Matter of the Application of ProphetX LLC for Designation as a Contract Market Commodity Futures Trading Commission · Checked October 30, 2026Our copy
- KalshiEX v. Flaherty, precedential opinion U.S. Court of Appeals for the Third Circuit · Checked October 8, 2026Our copy
- KalshiEX v. Assad, Ninth Circuit opinion U.S. Court of Appeals for the Ninth Circuit · Checked October 8, 2026Our copy
- KalshiEX v. Martin, docket U.S. Court of Appeals for the Fourth Circuit · Checked October 8, 2026
- KalshiEX v. Schuler, opinion (Ohio and Tennessee) U.S. Court of Appeals for the Sixth Circuit · Checked October 12, 2026Our copy
- KalshiEX v. Cox, docket U.S. Court of Appeals for the Tenth Circuit · Checked October 8, 2026
Show all 14 documentsShow fewer
- KalshiEX v. Williams, docket U.S. Court of Appeals for the Second Circuit · Checked October 8, 2026
- United States v. State of Wisconsin, docket U.S. District Court for the Eastern District of Wisconsin · Checked October 22, 2026
- KalshiEX v. Bird, docket U.S. District Court for the Southern District of Iowa · Checked October 8, 2026
- Supreme Court docket, No. 26-299 Supreme Court of the United States · Checked October 30, 2026
- Supreme Court docket, No. 26-338 Supreme Court of the United States · Checked October 12, 2026
- Supreme Court docket, No. 26-344 Supreme Court of the United States · Checked October 12, 2026
Also on Realize
At tax time.
An order changes where ProphetX offers a market.
Price your ProphetX year three common ways.
Enter a ProphetX net result for a federal range under each common route.