One Exchange, Fifty Fights: The States vs. Kalshi
Kalshi raised $1 billion at a $40 billion valuation on Thursday. It is also, at the same time, fighting for its legal life in courtrooms across America.
Utah has filed 14 criminal charges against Kalshi's co-founders. The CFTC has sued Utah right back, calling the charges federal overreach, and the CFTC's enforcement chief has named insider trading a top prediction-market priority.
The courts cannot agree with each other. State regulators have prevailed in Nevada, Maryland and Ohio — the Sixth Circuit recently ruled against Kalshi's federal preemption argument — while Kalshi won relief in Tennessee. Eleven states are pursuing legal action in total.
The market is adapting in real time. When Phantom rolled Kalshi markets into its wallet app this month, it blocked sports contracts in Michigan, and sports, elections and politics in Nevada and Washington.
There is now a market on whether the Supreme Court accepts a sports event contract case by December 31 — priced at 23.5%. The industry's future may be decided there.
Sources: ·
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