New York sues Kalshi over alleged illegal gambling operation
New York sued Kalshi, arguing the prediction-market platform is running an illegal, unlicensed gambling business by offering event contracts tied to sports, elections, and other outcomes. The state wants Kalshi blocked from operating there, plus forfeiture of alleged illegal profits, user restitution, and triple damages in civil penalties. The case follows a cease-and-desist order from the New York State Gaming Commission and earlier court losses for Kalshi in its attempt to stop enforcement. The dispute centers on whether federally regulated prediction markets are exempt from state gambling laws. The CFTC has backed Kalshi’s position, arguing states cannot override its authority over designated contract markets and warning that conflicting state rules would disrupt federal commodities regulation. Prediction markets are growing in mainstream use, but Kalshi and rivals like Polymarket continue to face gambling and licensing scrutiny.
