NEW YORK SUES KALSHI, SEEKING UP TO $36 BILLION
New York has sued Kalshi, accusing it of operating an unlicensed gambling business under the name “prediction market.” The state is asking for the platform to be banned in the state, refunds to users, seizure of profits, and civil penalties.
New York estimates the total financial obligations could reach $36 billion, including a fine three times the amount of revenue allegedly obtained unlawfully and related penalties. This is the figure requested by the plaintiff only; it is not yet the amount Kalshi has been ordered to pay by the court.
The dispute centers on regulatory authority. Kalshi argues that prediction contracts are derivatives under the federal jurisdiction of the CFTC. New York says putting money on sports results, elections, or cultural events is gambling and must comply with the laws of each state.
If New York wins, the prediction market’s nationwide expansion model will be hit at its foundation. Kalshi may have to obtain licenses, pay taxes, and accept separate limits in each state.
This is a battle over whether a new market will be regulated like finance—or dragged back into the legal order of the gambling industry.
New York has sued Kalshi, accusing it of operating an unlicensed gambling business under the name “prediction market.” The state is asking for the platform to be banned in the state, refunds to users, seizure of profits, and civil penalties.
New York estimates the total financial obligations could reach $36 billion, including a fine three times the amount of revenue allegedly obtained unlawfully and related penalties. This is the figure requested by the plaintiff only; it is not yet the amount Kalshi has been ordered to pay by the court.
The dispute centers on regulatory authority. Kalshi argues that prediction contracts are derivatives under the federal jurisdiction of the CFTC. New York says putting money on sports results, elections, or cultural events is gambling and must comply with the laws of each state.
If New York wins, the prediction market’s nationwide expansion model will be hit at its foundation. Kalshi may have to obtain licenses, pay taxes, and accept separate limits in each state.
This is a battle over whether a new market will be regulated like finance—or dragged back into the legal order of the gambling industry.
