A federal court in Ohio has denied a motion filed by prediction market company Kalshi to stop state regulators from overseeing sports contracts on its platform.

 

On Monday, Chief Judge Sarah Morrison of the U.S. District Court for the Southern District of Ohio rejected Kalshi’s request for a preliminary injunction that would have blocked the Ohio Casino Control Commission and the state attorney general from regulating the sports betting contracts offered by Kalshi.

 

Image credit: CourtListener

 

 

The judge ruled that Kalshi failed to prove its sports event contracts were exclusively supervised by the Commodity Futures Trading Commission (CFTC).

 

“Even if this court were to find that sports event contracts are swaps subject to the CFTC’s exclusive jurisdiction, Kalshi has not shown that the Commodity Exchange Act (CEA) would necessarily preempt Ohio’s sports gambling laws,” the opinion and order stated.

 

“Kalshi argues that Ohio’s sports gambling laws are field- and conflict-preempted by the CEA when it comes to sports event contracts traded on its exchange [...] Kalshi fails to establish that Congress intended the CEA to preempt state laws on sports gambling,” the opinion and order added.

 

Image credit: Court Listener

 

For clarity, here's a breakdown of what's going on:

• Kalshi asked an Ohio court to block the Ohio Casino Control Commission and the state’s attorney general from regulating its sports contracts, arguing that the contracts were already under the oversight of the CFTC, a federal regulator.
• The court denied the request, stating that Kalshi had not proven that the sports contracts on its platform were actually being regulated by the CFTC.
• The court further noted that although the CFTC had not taken action against the contracts, that does not make them legal under federal law.

 

 

Kalshi's Back-and-Forth Battle With Regulation

Despite CFTC Chair Michael Selig stating in February that federal regulators have exclusive jurisdiction over prediction markets, Kalshi and other prediction market companies continue to face challenges from state regulators seeking oversight.

 

In March 2025, the Nevada Gaming Control Board issued a cease-and-desist order against Kalshi, ruling that its sports event contracts constituted illegal sports wagers. Kalshi responded by filing a federal lawsuit, which resulted in a temporary restraining order and preliminary injunction, allowing the company to continue operating in the state.

 

However, a federal judge in Nevada later lifted the preliminary injunction, ruling that Kalshi must comply with the state’s gaming regulations.

 

Earlier this year, the Tennessee Sports Wagering Council sent cease-and-desist letters to Kalshi and other prediction market companies, stating that offering contracts on sports events was illegal in the state and constituted unlawful sports betting.

 

In response, Kalshi filed a lawsuit against state regulators in federal court and obtained a temporary restraining order preventing Tennessee authorities from enforcing the cease-and-desist order.

 

 

More than two years after FTX collapsed and reshaped the crypto industry, Sam Bankman-Fried is still fighting.

 

The former FTX CEO, now serving a 25 year federal prison sentence, has formally moved for a new trial in Manhattan federal court. The filing argues that key evidence was excluded, important testimony never reached the jury, and that the original proceedings did not present the full picture of what was happening inside the exchange before its implosion.

 

It is a long shot. But it keeps one of crypto’s biggest scandals squarely in the headlines.

 

 

A Quick Reset: How We Got Here

FTX was once valued at $32 billion and marketed itself as the responsible face of crypto trading. Bankman-Fried cultivated relationships in Washington, testified before Congress, and presented himself as a regulator-friendly industry leader.

 

That narrative unraveled in November 2022.

 

After a liquidity crunch exposed a multibillion-dollar hole in FTX’s balance sheet, the exchange halted withdrawals and filed for bankruptcy. Prosecutors later alleged that customer deposits were secretly routed to Alameda Research, Bankman-Fried’s trading firm, where the funds were used for speculative bets, venture investments, loans to executives, and political donations.

 

The case moved quickly. By late 2023, a jury found Bankman-Fried guilty on seven counts including wire fraud, securities fraud, and conspiracy. Several former executives, including Caroline Ellison and Nishad Singh, testified for the government. In 2024, Judge Lewis Kaplan sentenced him to 25 years in prison.

 

It was one of the most significant criminal convictions in crypto’s short history.

 

 

The Argument for a New Trial

Bankman-Fried’s latest filing hinges on a legal mechanism that allows courts to grant a new trial if newly discovered evidence could materially affect the verdict, or if there were serious procedural errors.

 

His motion makes a few central claims.

 

First, that certain testimony from former FTX and Alameda insiders was either excluded or not fully presented to the jury. According to the filing, that testimony could challenge the government’s portrayal of FTX as hopelessly insolvent and operating as a straightforward fraud.

 

Second, the defense argues that FTX’s collapse was more akin to a bank run than an inevitable implosion. In this telling, the exchange had assets and would have recovered if not for the sudden withdrawal panic that followed public reporting about its balance sheet. That argument goes directly to intent, which was central to the prosecution’s case.

 

Third, the motion questions the credibility of cooperating witnesses. Bankman-Fried claims some testimony evolved under government pressure and suggests that early statements made by insiders painted a more ambiguous picture of events than what jurors ultimately heard.

 

The filing also calls for Judge Kaplan to step aside from reviewing the request, alleging bias in evidentiary rulings during trial.

 

None of this is easy to prove. Courts rarely grant new trials once a conviction has been secured and upheld through sentencing. The legal threshold is high, particularly in complex financial cases where juries have already weighed extensive testimony.

 

 

The Broader Legal Strategy

The new trial motion is separate from Bankman-Fried’s ongoing appeal. That appeal focuses on whether the trial court made reversible legal errors, including limiting certain lines of defense.

 

Appeals courts typically give trial judges considerable leeway in managing evidence and courtroom procedure. Overturning a conviction requires demonstrating more than disagreement. It requires showing that errors materially affected the outcome.

 

For now, the new filing appears to be part of a layered strategy. Preserve every argument. Challenge every ruling. Keep procedural options open.

 

 

The Bottom Line

FTX’s collapse triggered one of the most severe credibility crises crypto has faced. Billions in customer assets were trapped. Venture capital firms wrote down massive stakes. Regulators in the U.S. and abroad accelerated enforcement and oversight efforts.

 

Even as the industry shifts toward ETF approvals, institutional adoption, and regulatory frameworks, the FTX saga remains a reference point. It is cited in congressional hearings, enforcement actions, and investor debates about custodial risk.

 

Bankman-Fried’s continued legal maneuvers keep the story alive, even if the odds of a successful retrial remain slim.

 

For many in crypto, the question is less about whether he gets a second trial and more about what the case ultimately represents. Was FTX an isolated failure of governance and internal controls, or proof that parts of the industry scaled too quickly without guardrails?

 

The courts will decide the narrow legal questions. The market, as always, is deciding the broader narrative in real time.

 

For now, one of crypto’s most infamous founders is still arguing that the story jurors heard was incomplete. Whether a judge agrees is another matter entirely.