A Nevada judge has upheld a statewide ban on prediction market platform Kalshi offering sports-related contracts, siding with regulators who argue the company’s products amount to unlicensed gambling.
First Judicial District Court Judge Jason Woodbury granted a preliminary injunction requested by the Nevada Gaming Control Board, extending an earlier temporary restraining order that blocked Kalshi from operating in the state.
The ruling prevents the New York-based company from allowing Nevada users to trade on the outcomes of sporting events and other real-world occurrences without obtaining a state gaming license.
Woodbury said Kalshi’s event-based contracts are “indistinguishable” from traditional sports betting, rejecting the company’s argument that its offerings are financial instruments regulated exclusively by the federal Commodity Futures Trading Commission.
The decision marks one of the most significant setbacks for Kalshi as it fights legal battles across the country over whether its platform constitutes gambling or federally regulated trading. Nevada remains the only state where a court-ordered ban is in effect at this time.
Kalshi has argued that its markets, which allow users to buy and sell contracts tied to outcomes such as election results or sports games, fall under federal commodities law, not state gambling regulations.
The CFTC has filed suit against the states of Arizona, Connecticut, and Illinois, challenging their efforts to ban prediction market betting on platforms such as Kalshi.
Nevada regulators have countered that the contracts mirror traditional wagers and must comply with the state’s strict gaming laws, which require licensing and oversight of sportsbooks.
Attorneys for Kalshi have indicated the company plans to appeal the Nevada ruling, setting up a continued legal fight that could help determine how prediction markets are regulated nationwide.
In its multistate lawsuit, CFTC Chairman Michael S. Selig warned against what he described as regulatory overreach by states.
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“The CFTC will continue to safeguard its exclusive regulatory authority over these markets and defend market participants against overzealous state regulators,” Selig said.
The CFTC and prediction markets are increasingly facing pressure from lawmakers to separate themselves from gambling, with Sens. Adam Schiff (D-CA) and John Curtis (R-UT) introducing bipartisan legislation that would bar the CFTC from approving contracts that resemble sports betting or casino-style gambling.
