Second Circuit Won’t Pause New York, Connecticut Actions Against Kalshi and Coinbase

Dextape brief

By Dextape Desk · November 4, 2026

On Tuesday, Nov. 3, the U.S. Court of Appeals for the Second Circuit denied requests from Kalshi and Coinbase to pause state actions while their appeals proceed. Kalshi cannot obtain federal court protection from New York's gaming regulator or Connecticut's consumer protection department, and Coinbase cannot obtain it from Connecticut Attorney General William Tong. Judges John M. Walker Jr., Dennis Jacobs and Joseph F. Bianco issued a two-page order denying the injunction motions, stating only that the companies had not shown an injunction was warranted. The order gives no reasoning on whether sports event contracts fall under federal or state law. The three appeals remain pending. The CFTC was allowed to file as a friend of the court in Kalshi's New York motion, according to The PM Pulse.

Why it matters: The ruling leaves state enforcement against prediction market operators in place while the federal preemption question for sports event contracts remains unresolved by the appeals court.

Mentioned: Coinbase

Summary by Dextape, based on reporting by Unchained. Written with AI from the publisher’s text and checked automatically for copied wording and unsupported figures. Not investment advice.