Technology news and discussion on TalkFuse.
US appeals courts let states enforce gambling laws against Kalshi
Kalshi has suffered another round of legal setbacks as federal appeals courts declined to block gambling laws in Nevada, New York and Connecticut. The rulings strengthen states’ efforts to regulate the prediction market as a gambling operator, despite Kalshi’s argument that its contracts are financial swaps subject to federal oversight.
Separately, Arkansas Attorney General Tim Griffin has sued Kalshi in state court, alleging it offered unlicensed gambling, failed to pay required taxes and let people aged 18 to wager, below Arkansas’s 21-year minimum for electronic wagering accounts. The Ninth Circuit refused to reconsider its ruling allowing Nevada to stop Kalshi sports bets, while the Second Circuit upheld lower-court decisions denying Kalshi’s requests to pause enforcement in New York and Connecticut. Utah has also brought criminal charges, and the dispute could ultimately reach the Supreme Court.
In short
- Appeals courts rejected Kalshi’s attempts to halt state gambling laws.
- Arkansas has sued over alleged unlicensed wagering and unpaid taxes.
- The dispute over state authority could reach the Supreme Court.
Steelman: both sides, in good faith
The strongest fair case each way — we don't pick a winner.
The case for
States can argue that sports event contracts function much like wagers, so applying gambling laws protects consumers, enforces age limits and licensing rules, and ensures operators pay applicable taxes. They may also say that federal oversight of financial markets should not automatically displace state authority over gambling within their borders.
The case against
Kalshi can argue that its event contracts are federally regulated financial products, not ordinary bets, and that allowing each state to restrict them could undermine a consistent national market. It may also contend that federal rules provide the appropriate framework for oversight, while state gambling laws risk excluding lawful products and users from that market.
Read the full article at the source →
Originally published by Ars Technica as “Kalshi court losses pile up as judges refuse to block state gambling laws”.