Nevada is suing to block the prediction market platform Kalshi from allowing residents to place bets on the outcomes of events, including elections and sports games, as reported earlier by Business Insider. The lawsuit adds to a growing number of legal battles across the country, claiming that Kalshi is harming the state’s gambling market by operating without a proper license and by allowing users under 21 to use the platform.
The state of Nevada filed the lawsuit just hours after a federal appeals court denied Kalshi’s request to block Nevada from taking action against the company. As prediction betting platforms like Kalshi and Polymarket become more popular — allowing users to place bets on everything from election outcomes to the capture of Venezuelan President Nicolás Maduro — state lawmakers have had to grapple with how to regulate them. But putting local restrictions on prediction betting markets may prove difficult, as the federal Commodity Futures Trading Commission (CFTC) is rallying against state-level regulations.
In an op-ed for The Wall Street Journal, CFTC head Michael Selig argues that state-level regulations “undermine the agency’s exclusive jurisdiction over these markets.” He adds that these “exchanges aren’t the Wild West, as some critics claim, but self-regulatory organizations that are examined and supervised by experienced CFTC staff.” The CFTC also filed an amicus brief in support of Crypto.com’s appeal as part of a legal battle with the state of Nevada over its prediction market offering.
Now, Nevada is asking the court to prevent Kalshi from letting users in the state place bets until it obtains the appropriate license. “Kalshi does not employ adequate safeguards to ensure that wagers are not being placed on an event by owners, coaches, players, or officials participating in the event, and does not communicate about potential evidence of match fixing or point shaving with Nevada gaming regulatory authorities,” Nevada’s lawsuit claims. Kalshi declined to comment.