● Covered by 1 source · 1 reportMedium impact1 neutral
CFTC Declares Market Emergency, Orders Kalshi to Continue Operations in New York
Key points
- CFTC declared a market emergency on August 11, 2026.
- KalshiEX, LLC was ordered to continue operating despite a New York lawsuit.
- New York seeks to prohibit Kalshi from offering event contracts nationwide.
- CFTC asserts federal authority over interstate derivatives markets.
CFTC Responds to Kalshi Emergency
On August 11, 2026, the Commodity Futures Trading Commission (CFTC) exercised its emergency authority in response to a market emergency notification from KalshiEX, LLC. The CFTC ordered KalshiEX, LLC to continue its operations in compliance with the Commodity Exchange Act's Core Principles.
New York Lawsuit Against Kalshi
KalshiEX, LLC's emergency notification to the CFTC followed a lawsuit filed by New York Attorney General Letitia James on July 31. The lawsuit seeks a temporary restraining order to prevent KalshiEX, LLC from offering all event contracts nationwide and demands over $36 billion in damages.
Federal Jurisdiction and Market Stability
The CFTC's action underscores its mandate to provide a uniform national market for derivatives transactions, ensuring market resilience and orderliness. Chairman Michael S. Selig stated that Congress intended for derivatives exchanges to be regulated federally, not by a "patchwork of state gaming laws," as these are interstate financial markets.
The Commission is legally required to ensure order in these markets and views major market disruptions as hindrances to competitive, fair, and efficient markets that protect the price discovery process.
Ongoing State vs. Federal Authority Disputes
This incident is part of a broader pattern where states have attempted enforcement actions against CFTC-regulated Designated Contract Markets (DCMs). To protect its congressionally granted jurisdiction, the CFTC has previously filed lawsuits against multiple states, including Arizona, Connecticut, Illinois, Kentucky, Minnesota, New Mexico, New York, Rhode Island, and Wisconsin, and has submitted amicus briefs in federal appeals courts and a state supreme court.
✨ This summary was generated by AI from the outlets' reporting listed below. It is not independently verified and may contain errors — check the original sources. How BrevFeed works →
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Reporting from
The Commodity Futures Trading Commission (CFTC) declared a market emergency and ordered KalshiEX, LLC to continue operating, following a lawsuit filed by the New York Attorney General seeking to halt the exchange's nationwide event contract offerings. This action by the CFTC aims to maintain market stability and assert federal jurisdiction over derivatives exchanges against state-level challenges.