Coinbase sued the state in December 2025 as part of a wider challenge to state regulation of prediction markets. The exchange wants to give customers, including Michigan residents, access to event contracts offered by Kalshi. Operators counter that event contracts are financial instruments traded between buyers and sellers rather than conventional sportsbook bets. If courts accept sports event contracts as federally regulated derivatives, prediction-market operators could gain a much clearer route to nationwide distribution. The agency also introduced new rules in June that would preserve support for sports-related event contracts despite opposition from state regulators.