NewsDialy

U.S. appeals courts split on prediction market contracts, Supreme Court fight likely

9/13/2026

Two federal appeals courts have now reached opposite conclusions on whether sports-related event contracts are swaps, a class of regulated financial instrument under federal law.

The Ninth Circuit Court of Appeals ruled that those contracts do not qualify, contradicting the Third Circuit's decision in April. The disagreement sets up a likely fight at the Supreme Court.

Prediction markets are platforms where participants trade contracts tied to the outcome of future events, including sporting events. Those contracts let people take positions on what will happen in a sporting event.

The legal dispute turns on how those contracts are classified, because the classification determines what rules apply.