Amid the surge of legal gambling in the United States, one area that has remained off-limits is betting on the outcome of U.S. elections. However, this could be about to change as a federal judge in Washington recently made a significant ruling.
The judge overturned a decision by the Commodity Futures Trading Commission that had prohibited a company from offering bets on the outcome of Congressional elections. The New York-based company, Kalshi, emerged victorious in this legal battle, with the judge ruling in its favor.
The court has temporarily halted further proceedings until after a scheduled hearing on Thursday, where the rationale behind the decision is expected to be outlined. The judge may also rule on the agency's request for a two-week delay in the case.
Kalshi argued that the commission had lost on legal grounds and should not be allowed to delay the process until after the upcoming Congressional elections. The company emphasized the importance of providing access to these contracts to both Kalshi and the public.
While no U.S. jurisdiction currently permits betting on elections, such bets are available through foreign websites, particularly in Europe where elections betting is common. The commission had previously informed Kalshi that offering prediction bets on party control of the House of Representatives and the Senate was illegal gambling activity that could compromise the integrity of elections.
Following the judge's ruling, Kalshi would have been able to list and accept bets on its Congressional markets if the matter had not been paused. It remains to be seen whether other companies will also seek to offer bets on various elections, including the presidential race.
In 2020, major sportsbooks expressed interest in taking bets on the U.S. presidential elections if it were legally permissible. European bookmakers currently favor Vice President Kamala Harris to win the election, giving her a slight edge based on recent debates.
As the legal landscape around gambling on U.S. elections potentially shifts, the industry and regulators will continue to navigate this evolving terrain.
