Are prediction markets legal in your state in 2026
Kalshi and Polymarket US are federally regulated, but states are fighting their sports contracts in court. How to check your state and what open trades face.
Short answer, as of September 2026: an adult in any US state can open a Kalshi account and trade its contracts on the Fed, inflation, elections, and weather, because Kalshi is a federally regulated exchange rather than a state-licensed sportsbook. The fight is over sports contracts, where a group of states has said federal registration does not exempt a venue from state gaming law, and the courts have not finished answering. Whether a Super Bowl contract is available to you depends on your state, the venue, and the most recent ruling.
Two rulebooks, one argument
Prediction markets sit under the Commodity Exchange Act. The Commodity Futures Trading Commission licenses exchanges as designated contract markets, and a designated contract market may list event contracts on whether something happens. Kalshi has held that status since 2020. The Polymarket US app runs on a licensed exchange and clearinghouse that Polymarket bought in 2025, while the global Polymarket site stays closed to US persons under a 2022 settlement with the same regulator. Which Polymarket you are looking at matters for everything on this page, and the differences between the venues start there.
Sports betting runs on a different rulebook. It is state law. Each state decides whether to license sportsbooks, how to tax them, and who may bet. The venues argue that a federally registered exchange trading a federally regulated contract is outside state gaming law, because the Act gives the federal regulator exclusive jurisdiction over contracts traded on its exchanges. The states argue that a contract on who wins a football game is a sports bet, whatever the paperwork calls it. Both arguments are serious, which is why the cases are still running.
How the dispute got here
Kalshi listed contracts on game outcomes in January 2025, beginning with the Super Bowl. Within weeks, gaming regulators in Nevada, New Jersey, Ohio, Maryland, Illinois, Montana, and other states sent cease-and-desist letters telling the venue to stop offering sports contracts to their residents. Kalshi did not stop. It sued in federal court, arguing that federal law pre-empts the state rules, and other venues that had copied the product received letters of their own.
The early rulings split. District courts in Nevada and New Jersey granted Kalshi preliminary injunctions in the spring of 2025, letting it keep trading in those states while the cases proceeded. A Maryland district court declined to do the same. Massachusetts took the venue to its own state court. Appeals followed in more than one circuit, and as of September 2026 the question sits with federal appellate courts, with a split among circuits a live possibility and the Supreme Court the obvious destination if one appears. A ruling can land any week. Check the venue's own page before relying on it.
The election contracts went through their own version of this in 2024, when the federal regulator itself tried to block them and lost on appeal. That fight was federal versus federal. The sports fight is federal versus state, which is harder to end with one decision.
What "available in your state" means on each venue
Kalshi. Account opening is nationwide. The app checks your location when you place an order, not just when you sign up. If a court order or an agreement with a state requires the venue to pause a category there, the category shows as unavailable in that state while the rest of the venue works normally. A resident of a state in dispute can hold Fed and CPI contracts on the same afternoon a sports contract is greyed out. How Kalshi works covers the mechanics.
Polymarket US. The regulated app keeps its own state list and its own location check. It launched after the first letters went out, so its list is not a copy of Kalshi's, and a state can be open on one venue and closed on the other in the same week.
Polymarket global. Not available to US persons in any state. A VPN changes what the website shows you, not what the law says, and it violates the venue's terms, which can freeze a balance. The global markets appear on our trackers as reference prices, and how Polymarket works explains why the two Polymarkets are different products.
Non-sports contracts have not been the subject of the letters. Fed, inflation, election, and weather contracts trade in every state on Kalshi, and the state disputes have not tried to reach them.
How to check today
- Open the venue's own availability page. Kalshi publishes a help article listing where its products are offered; Polymarket US publishes a state list. These pages change when a ruling changes.
- Try to open the specific market. A blocked category is greyed out or missing in a blocked state, and that is the most current signal there is.
- Look up the current court posture for your state. The venues post about wins and losses; state gaming regulators post their letters and complaints.
- Note the difference between "we are appealing" and "we have paused." A venue can be losing a case and still trading under an injunction, or winning and still paused by agreement.
What happens to open positions if a venue withdraws
The rulebook answers this, not the news. Three patterns exist. A venue can go close-only in a state, letting residents sell what they hold but not buy more. It can let positions ride to settlement, paying them out normally while blocking new trades. Or it can close a market early at a price its rules specify, which is the case to read most carefully, because the rule decides whether you get the last trade, a mid price, or something else. Cash withdrawals are not affected by any of these; the dispute is over the contracts, not the bank account. How settlement works covers the ordinary case that these paths depart from.
A worked example
A reader in a state whose regulator sent a letter holds 50 YES contracts on a Super Bowl winner, bought at 20% for $10.00 in total. A court then rules against the venue in that state. What the position is worth depends on which path the venue takes.
| Path | What the reader can do | Cash result |
|---|---|---|
| Close-only | Sell 50 at the 19% bid | $9.50 minus a $0.54 fee, so $8.96 |
| Ride to settlement | Hold to February | $50.00 if the team wins, $0 if not |
| Early close at last trade | Nothing; the venue pays 20% | $10.00 |
The $0.54 is Kalshi's taker fee on the sale as of September 2026: 0.07 × 50 × 0.19 × 0.81 = $0.5387, rounded up to the cent. The fee formula is the same one that applies to any order, and Kalshi's own fee page is the place to confirm it. The point of the table is that a legal ruling does not by itself cost the reader money; the mechanism the rulebook picks does, and the close-only path is the worst of the three here only because the bid sat a point below the last trade and the sale paid a fee.
The same applies to longer-dated sports positions, such as NFL MVP or college football champion, where months can pass between a ruling and the game. Sports contracts and sportsbook bets are different products with different fine print, which is part of what the courts are deciding.
What to check before you trade
- Which venue and which app: Kalshi, Polymarket US, or the global site.
- The venue's own availability page for your state, today.
- Whether the market you want is in a category under dispute, which as of September 2026 means sports.
- The rulebook section on early closure and close-only trading, before you hold a position through a court date.
- The current posture of your state's case, and whether the venue is trading under an injunction that can be lifted.
Nothing on this page is investment advice, and the venue's current rule text and fee page are the only things that pay.
Reviewed Thu, Sep 17, 2026. Guides are re-read against the live markets every week; fees, rules, and availability change, and the venue’s own page is the final word.