New Delhi, April 11 -- Kalshi Inc. won a temporary reprieve from criminal prosecution in Arizona when a judge suspended the case at the behest of a federal regulator.

A federal judge on Friday granted a restraining order sought by the Commodity Future Trading Commission after the agency argued that state authorities cannot pre-empt its oversight of prediction markets, the CFTC said in a statement.

Two days earlier, Kalshi failed to persuade a federal judge to halt Arizona's criminal proceedings against the prediction market provider as the widespread legal battle among states, companies and the Trump-administration-controlled federal agency that governs derivatives trading continues to roil.

"Arizona's decision to weaponize state crimi...