The prediction platform Kalshi has initiated a lawsuit against the Nevada Gaming Control Board and the New Jersey Division of Gaming Enforcement. This move comes in response to the regulators’ demands to prohibit trading of event-based contracts in the specified states.
This is reported by Finway
The company’s lawyers stated that its markets fall under the regulation of the Commodity Futures Trading Commission (CFTC), rather than the jurisdiction of the states. Kalshi co-founder Tarek Mansour emphasized that prediction markets are an innovative idea that has been misinterpreted from the very beginning. The company is prepared to defend its rights in court.
BREAKING: Kalshi has filed a lawsuit in Nevada federal court seeking an “immediate temporary restraining order and preliminary injunction” against the Nevada Gaming Control Board for “unconstitutionally threatening” to prohibit all trading of @kalshi’s event-based contracts.
Additionally, Kalshi is challenging the ban on election-related contracts that was implemented in Nevada, despite a U.S. court ruling them legal in 2024. This decision allowed the company to offer such contracts on a national level.
The regulatory landscape is also changing due to a new approach from the CFTC. On February 4, 2025, acting agency director Caroline Pham announced that the regulator would focus on combating fraud rather than strict oversight, which was positively received by market participants following the stringent scrutiny under the Biden administration.
The CFTC also conducted an investigation regarding the legality of the Super Bowl event contracts offered by Kalshi and Crypto.com, but ultimately took no action to ban them, confirming their compliance with U.S. derivatives legislation.
It is worth noting that it was previously reported that the Polymarket platform was deemed an illegal gambling site in Singapore.