Tennessee judge issues injunction blocking state move against Kalshi

CoinTelegraph

by Christina Comben

February 20, 2026

AI-Generated Deep Dive Summary

A US federal judge in Tennessee has issued an injunction halting the state's enforcement of gambling laws against Kalshi, a cryptocurrency-based prediction market operator. The court ruled that Kalshi's sports event contracts fall under the jurisdiction of the Commodity Futures Trading Commission (CFTC), preempting Tennessee's attempt to regulate them as illegal gambling activities. This decision allows Kalshi to continue offering its services in the state while its lawsuit against Tennessee regulators proceeds. Kalshi operates a blockchain-based platform where users can trade prediction contracts tied to sports events. The company had argued that its offerings are financial instruments regulated by federal commodities law, not subject to state gambling regulations. Judge Aleta Trauger agreed, finding that Kalshi is likely to succeed in proving that federal law preempts Tennessee's actions. This ruling highlights the complex interplay between state and federal jurisdictions in the rapidly evolving crypto and blockchain space. The case underscores the ongoing challenges faced by cryptocurrency businesses navigating varying regulatory landscapes across states. By determining

Verticals

cryptoblockchain

Originally published on CoinTelegraph on 2/20/2026