Kalshi faces Washington state gambling ruling over prediction market bets
To obtain a preliminary injunction, plaintiffs must show that they are likely to succeed on the merits of their claims. Judge McHale determined that Washington state was likely to prevail in arguing that Kalshi violated state gambling and consumer protection laws.
“Kalshi operates an online betting platform that markets itself as a ‘prediction market,’ allowing consumers to wager on thousands of topics, including sports, political elections, entertainment, popular culture, and whether a celebrity will say a specific word or phrase,” McHale wrote.
The judge found that, under Washington law, “Kalshi’s offering, marketing, and advertising of illegal gambling activities constitutes an unfair and/or deceptive act or practice in trade or commerce.”
Washington Attorney General Nick Brown praised the ruling, saying, “Kalshi got rich promoting bets on sports, elections, natural disasters, events related to the Iran war, and more. Under this order, Kalshi is prohibited from offering bets on most of those topics in Washington.”
Kalshi argues that the U.S. Commodity Futures Trading Commission (CFTC) has exclusive jurisdiction over prediction markets and that the company is not required to comply with state gambling laws. The Trump administration has made similar arguments while suing states that attempt to regulate prediction-market platforms. The broader legal dispute involving the states, the federal government, and Kalshi is being litigated in state and federal courts across the country.
“Kalshi is regulated by the CFTC, and the CFTC has exclusive jurisdiction over our exchange,” a Kalshi spokesperson said in a statement provided to Ars. “We respectfully disagree with the court’s decision and are considering all legal options.”
Source: arstechnica.com