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Connecticut Federal Court Denies Kalshi and Coinbase Injunctions

Quick Glance at the Facts

• U.S. District Judge Vernon D. Oliver ruled on August 10, 2026 that sports event contracts offered by Kalshi and Coinbase are sports wagers under Connecticut law.
• The judge found Kalshi unlikely to succeed on the merits and suggested the company apply for a Connecticut gaming license.
• Connecticut joins Michigan, Nevada, New York, Utah, and Washington in rejecting Kalshi’s injunction bids since June 2026.

A Connecticut federal judge denied preliminary injunctions for Kalshi and Coinbase on August 10, 2026, ruling that their sports event contracts are sports wagers subject to state gambling law. The decision clears the way for Connecticut’s Department of Consumer Protection to enforce its cease-and-desist orders against both companies.

Judge Rules Sports Contracts Are Sports Wagers

U.S. District Judge Vernon D. Oliver handed Kalshi and Coinbase a loss in the District of Connecticut this week. Echoing rulings in other states, the judge concluded in the ruling that “Kalshi characterizes its sports-related event contracts in various ways, but at bottom, they are sports wagers.”

The decision rested on two key findings. First, the judge ruled that sports event contracts are not “swaps” covered under the Commodity Exchange Act. Second, even if they were, Connecticut’s gambling laws would not be superseded by the CEA or the Commodity Futures Trading Commission. Kalshi had argued its prediction market products are derivatives regulated by the CFTC, not sports bets. The court disagreed.

This case traces back to December 3, 2025, when Connecticut’s Department of Consumer Protection Gaming Division issued cease-and-desist orders to KalshiEX LLC, Robinhood Derivatives LLC, and Crypto.com for unlicensed online gambling. According to the DCP, Commissioner Bryan T. Cafferelli stated that “only licensed entities may offer sports wagering in the state of Connecticut.” Gaming Director Kris Gilman added that “a prediction market wager is not an investment.” Kalshi and Coinbase both sued Connecticut in December 2025, and court records show Judge Oliver initially granted a temporary hold on enforcement.

What Happens Next for Kalshi

Kalshi is expected to appeal, following the pattern it has set in other states. As SBC Americas reported on August 10, 2026, Kalshi has lost injunction bids or faced limited temporary relief in Michigan, Nevada, New York, Utah, and Washington since late June 2026.

Two of those states, Michigan and Nevada, have set an August 12 deadline for Kalshi to geoblock sports event contracts. Coinbase was also denied an injunction in Michigan the prior week. These losses are piling up fast.

What This Ruling Means for Connecticut Players

If you live in Connecticut and have been using Kalshi or Coinbase for sports event contracts, access could be cut off soon. The DCP can now enforce its original cease-and-desist orders. According to the Connecticut Department of Consumer Protection, the state already licenses three sports wagering operators: DraftKings (through Foxwoods), FanDuel (through Mohegan Sun), and Fanatics (through the Connecticut Lottery). Sports event contracts from unlicensed prediction market platforms are not the same as licensed online sportsbooks, and the state is making that distinction clear.

GamblingNerd Take

This ruling is another blow to prediction market platforms trying to sidestep state licensing requirements. If you have been using Kalshi or Coinbase for sports contracts in Connecticut, you should check your account for any geoblock notices and consider actual Connecticut sportsbooks as your alternatives. Odds are different, since lines are set by bookies and not the public, but you don’t have to worry about account closure because of legal troubles.