New York has joined several other states in suing prediction-market platform Kalshi, alleging it is operating an illegal gambling business without a state gaming licence. Attorney General Letitia James is seeking to block the New York-headquartered company from operating in the state, making the case another test of whether prediction markets fall under federal financial regulation or state gambling law.

The lawsuit says Kalshi accepts wagers from New Yorkers, including people under the legal gambling age of 21, exposing them to personal and financial risks; it also seeks restitution for customers. New York follows Nevada, New Mexico, Arizona and Washington in taking action, while the Commodity Futures Trading Commission maintains it has exclusive jurisdiction over prediction markets; Kalshi called the lawsuit political and warned it could drive users offshore.