A U.S. federal judge has ruled to remand the case against prediction market platforms Kalshi and Polymarket back to state court, allowing Nevada regulators to pursue a temporary injunction. This decision, made on March 3, increases the likelihood that both platforms may have to suspend trading in Nevada. The court determined that the claims by the Nevada gaming regulator were based on state law, and the Commodity Exchange Act did not preempt state gambling laws, thus federal jurisdiction was not applicable. Kalshi and Polymarket had previously argued that the Commodity Futures Trading Commission had exclusive jurisdiction over event contract trading. If Nevada successfully obtains an injunction, Kalshi could be barred from offering event contracts in the state during litigation. The ruling is seen as a significant setback for Kalshi and may prompt other states to pursue similar legal actions. Polymarket's parent company, Blockratize, also had its case remanded to state court, and Polymarket has applied for an emergency stay to prepare for an appeal. Kalshi may seek a temporary stay from the U.S. Supreme Court.