Massachusetts Looks to Slam Door on Kalshi
If Massachusetts Attorney General Andrea Joy Campbell has her way, sports prediction-market operator Kalshi will be blocked from establishing a presence and conducting business in the Bay State.
Campbell is asking a state court judge to prevent Kalshi from opening its platform to Massachusetts residents, arguing that the company is operating an unlicensed gambling operation.
This is the first time a U.S. state is seeking to prevent wagering on a prediction platform via court order. Kalshi is facing lawsuits in multiple states from regulators who argue that the prediction market company is violating state laws by offering event contracts that are akin to sports bets.
Unlicensed Gambling Operation
Prediction market companies like Kalshi and Polymarket argue they do not fall under state law jurisdiction because they are regulated at the federal level by the Commodity Futures Trading Commission (CFTC). Platforms like Kalshi offer prediction contracts where individuals wager on the outcomes of specific events.
Sporting contests and entertainment events dominate the wagering on these sites, including an event contract currently asking people to predict the college football championship winner. There’s another contract asking who will win the next U.S. presidential election, and one inquiring whether President Trump will release any of the Epstein files.
In October, the NHL became the first major professional sports league to announce a partnership deal with Kalshi and Polymarket.
The enforcement action by the Massachusetts Attorney General is taking state legal challenges a step further. Specifically, Campbell is asking the court for an injunction that would shut down Kalshi’s operations in Massachusetts.
Kalshi: We’re Regulated by CFTC
Campbell argues that what Kalshi offers is sports betting disguised as event contracts. Sports betting is fully licensed and legal in Massachusetts.
Licensed sports betting and online casino operators in the state cannot offer their products to individuals under 21. Campbell contends that Kalshi offers its wagering products to people under that age.
