Massachusetts judge halts Kalshi sports prediction markets

A Massachusetts judge ordered Kalshi to halt sports prediction markets, ruling its contracts are unlicensed sports wagering. This first-of-its-kind order may set a precedent nationwide.

A Massachusetts judge has issued a preliminary injunction against Kalshi, a prediction markets platform, requiring it to halt all sports-related prediction markets in the state. The court determined that Kalshi’s event contracts on sporting outcomes constitute unlicensed sports wagering under state law, despite Kalshi’s claim that its services are federally regulated by the Commodity Futures Trading Commission (CFTC). This marks the first time a U.S. court has ordered a prediction market platform to comply with state gambling laws, potentially setting a precedent for similar actions elsewhere. The injunction was granted at the request of the Massachusetts Attorney General, following a lawsuit alleging illegal and unsafe sports wagering. The decision disrupts a significant portion of Kalshi’s trading volume and introduces regulatory uncertainty for digital gambling platforms nationwide. A hearing is scheduled to finalize the injunction and consider appeals, with Kalshi stating it plans to challenge the order.