Woofun AI reports that the U.S. Commodity Futures Trading Commission (CFTC) suspended an emergency rule filed by Kalshi on July 12, which sought to forcibly liquidate open sports event contracts for certain Michigan residents. The CFTC mandated that Kalshi adhere to standard procedures for fulfilling these transactions, rejecting the company's attempt to bypass normal protocols following an oral request from the Ingham County Circuit Court to close positions. This intervention halts a dispute originating in March, when Michigan Attorney General Dana Nessel and the Gaming Control Board sued Kalshi, alleging unlicensed internet sports betting, while Kalshi maintains its products are federally regulated derivatives under the Commodity Exchange Act.

CFTC Chairman Michael Selig stated that allowing the emergency rule would undermine confidence in completed derivatives transactions and risk significant market disruption. The Commission emphasized that state governments cannot compel designated contract markets to violate their contractual obligations, reinforcing the federal regulatory framework over local judicial interventions in this specific case.