Prediction Market News: Kalshi Faces New Lawsuit Amid State Regulatory Crackdown
Kalshi, a prediction market, is facing a federal lawsuit in Oregon and ongoing regulatory crackdowns from multiple states over claims of unlicensed sports betting.Summary
Prediction market Kalshi is currently embroiled in legal battles with state regulators and now faces a federal class action lawsuit in Oregon alleging operation of an “illegal online gambling enterprise.” This lawsuit seeks double damages under Oregon’s loss recovery statute. Several states, including Nevada, New Jersey, Maryland, and others, are pursuing legal action against Kalshi, claiming it violates their sports betting laws by operating without a license. The Commodity Futures Trading Commission (CFTC) has filed a brief defending its jurisdiction over Kalshi and Polymarket, but a recent Supreme Court ruling on Trump tariffs may favor the states' arguments.
Legal expert Daniel Wallach suggests the core issue revolves around whether the Commodity Exchange Act provides clear congressional authorization for the CFTC to regulate sports wagering, especially considering existing state authority over gambling. The court will hear arguments regarding the transfer of Kalshi’s case to federal court next Tuesday, consolidating arguments from both the Kalshi and Polymarket cases.
Analysts propose potential resolutions, including prediction markets obtaining gaming licenses for sports-related markets, while others predict the dispute will ultimately reach the Supreme Court. The outcome of these legal challenges could significantly impact the future of prediction markets in the United States.
(Source：CoinGape)