Kalshi Forced to Temporarily Halt Prediction Markets in Nevada
A Nevada state judge has upheld a temporary restraining order Friday blocking Kalshi from offering event-based contracts within the state. The decision followed a ruling one day earlier by the Ninth Circuit Court of Appeals denying Kalshi's request for a stay.
The order prohibits Kalshi from facilitating wagers tied to sports, elections, and entertainment markets within Nevada. It will remain in effect until April 3, when a hearing is scheduled in Carson City to determine whether a preliminary injunction should be granted.
Related: Judge Blocks Kalshi from Offering Prediction Markets in NevadaJudge Jason Woodbury stated that the Nevada Gaming Control Board (NGCB) has a reasonable likelihood of success on the merits of its claims. He also found that the potential harm to the state is irreparable and cannot be compensated through monetary damages.
Woodbury noted that unlicensed platforms limit the state's ability to enforce safeguards related to underage gambling and competition integrity. He contrasted that with licensed sportsbooks, which operate under established regulatory controls designed to protect consumers.
The ruling forms part of a prolonged legal battle between Nevada regulators and prediction market operators that has developed over the past year. State officials argue that these platforms fall under existing gambling laws and must comply with licensing requirements.
Kalshi continues to assert that its operations are authorized under federal oversight from the Commodity Futures Trading Commission. This position has created a regulatory conundrum, as state authorities maintain jurisdiction over gambling activity conducted within their borders.
Nevada regulators initiated the lawsuit in February, seeking to halt Kalshi's activity within the state. The action reflects a broader enforcement effort targeting multiple prediction market platforms operating without state licenses.
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Kalshi Continues to Lose Ground
NGCB Chair Mike Dreitzer said the agency has taken decisive steps to stop unauthorized operators. He stated that all known unlicensed prediction markets have now been restricted from operating in the state.
Dreitzer also challenged Kalshi's repeated assertion that its services are legal in all 50 states. He emphasized that any platform facilitating unlicensed gambling activity remains illegal under Nevada law and subject to enforcement action.
The Board maintains that Nevada's gaming framework is essential to protecting public welfare and maintaining industry standards. Regulators have reiterated that licensed operators must meet strict requirements related to consumer protection and operational integrity.
Opponents of prediction markets argue that Congress did not intend for federal regulators to authorize sports-related wagering products. They contend that such activity has historically been governed at the state level through established gaming laws.
The ruling signals a shift in how states approach enforcement against these platforms, and Nevada has now secured three temporary restraining orders against companies including Kalshi, Polymarket, and Coinbase. Similar legal developments have occurred in other states, with Massachusetts already having obtained a preliminary injunction against Kalshi.
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