The New York District Attorney's Office has filed a lawsuit against the prediction platform Kalshi

New York State Attorney General Letisha James has filed a lawsuit against the prediction platform Kalshi. She alleges that the company, which offers bets on the outcomes of events ranging from soccer matches to the presidential election, is operating without a license from the state Gaming Commission and is violating local laws against illegal gambling, Reuters reports.

The lawsuit has been filed in a Manhattan court. According to the prosecutor’s office, Kalshi’s contracts on the outcomes of sports competitions, elections, and other events—such as the winner of the Super Bowl or the reality show “Big Brother”—constitute bets on events over which participants have no control. This qualifies them as gambling, James argues. Separately, she objects to the fact that the platform allows users aged 18–20 to place bets, even though the minimum age for mobile sports betting in the state is 21.

“State gambling laws protect children from underage betting and help combat gambling addiction. No matter what they call themselves, prediction platforms like Kalshi are gambling establishments, period,” James said.

Kalshi called the New York Attorney General's decision "political theater," according to Reuters. "States can't just shut down a federally licensed exchange," the company noted.

Prediction markets surged in popularity after the 2024 U.S. presidential election, when Kalshi and Polymarket predicted Donald Trump’s victory more accurately than opinion polls, according to Reuters. Average monthly trading volumes in this segment rose from less than $100 million in early 2024 to more than $8 billion in December 2025, the Financial Times reported.

In April, the New York Attorney General filed similar lawsuits against two other event-based contract platforms—Coinbase and Gemini Titan. At least four other states—Massachusetts, Michigan, Nevada, and Washington—have already secured court rulings restricting Kalshi’s operations, Reuters added.

At the same time, the U.S. Commodity Futures Trading Commission (CFTC) is asserting exclusive oversight of this sector. It has challenged the regulatory actions of authorities in at least nine states, including New York, according to Reuters. Less than an hour before the New York Attorney General filed a lawsuit against Kalshi, the CFTC filed a motion with a Manhattan court seeking to halt the state’s enforcement actions, calling them an overreach of authority, the agency reports.

On July 8, Federal Judge Analisa Torres declined to bar New York from enforcing its local laws against Kalshi. On Wednesday, July 29, the Manhattan Court of Appeals denied Kalshi’s request for a stay of the state laws pending the appeal.

This article was AI-translated and verified by a human editor