US appeals court denies Coinbase and Kalshi's request to pause state enforcement

The U.S. Court of Appeals for the Second Circuit denied Coinbase Financial Markets and Kalshi's requests for injunctions pausing state enforcement actions while their appeals proceed, consolidating three appeals involving Coinbase in Connecticut and Kalshi in Connecticut and New York. The judges found the applicants failed to demonstrate that an injunction was warranted during the pendency of the appeals, though the ruling did not resolve the merits and did not require the platforms to halt trading or close existing positions. The decision matters because it allows Connecticut and New York regulators to continue enforcing prediction-market rules against the platforms while the underlying legal questions remain unresolved. What to watch next is the substantive outcome of the three consolidated appeals, which will determine how prediction markets are treated under state gaming and financial regulations.