Kalshi countered in federal court, asserting that as a CFTC-regulated exchange, it is not subject to state gaming laws. This stance, if upheld, would mean that fintech platforms like Kalshi could not simply bypass state laws by appealing to federal oversight. Should the court side with the state, prediction markets may need to recalibrate their expansion strategies, acknowledging state gambling authorities as gatekeepers even when they are federally regulated. The outcome promises to shape the broader future of prediction markets in America. If the state succeeds, prediction markets may need to adopt state-level licensing frameworks similar to traditional sportsbooks.