Massachusetts Takes Legal Action Against Kalshi
Prediction market platform Kalshi is facing a civil lawsuit from the Commonwealth of Massachusetts, which accuses the company of offering unlicensed sports betting to residents.
The lawsuit, filed in Suffolk County Superior Court, claims Kalshi disguises sports wagering as “event contracts” in violation of the state’s strict gambling laws.
Majority of Kalshi’s Volume Comes From Sports
According to the filing, more than three-quarters of Kalshi’s trading volume as of May 2025 came from sports — a larger share, it claimed, than industry giants DraftKings or FanDuel.
Massachusetts regulators argue this volume demonstrates that Kalshi’s platform operates as a sports betting service rather than a regulated exchange.
Kalshi Responds: “Outdated Laws”
In response, a Kalshi spokesperson criticized Massachusetts regulators for opting for litigation over dialogue:
“Rather than engage in dialogue with Kalshi as many other states have done, Massachusetts is trying to block Kalshi’s innovations by relying on outdated laws and ideas.”
The company reaffirmed its commitment to defending its platform:
“We are proud to be the company that has pioneered this technology and stand ready to defend it once again in a court of law. Prediction markets are a critical innovation of the 21st century, and all Americans should be able to access them.”
Kalshi Argues Federal Oversight
Kalshi maintains it is regulated at the federal level by the Commodity Futures Trading Commission (CFTC) and does not fall under state gambling jurisdiction.
The platform has received cease-and-desist orders from other states, including Arizona, Montana, Ohio, and Illinois.
Polymarket Eyes US Launch
The lawsuit comes amid a broader push for prediction markets in the United States. Business Insider reported that Polymarket, a blockchain-powered platform, is preparing to launch in the US while seeking funding that could value the company up to $10 billion.
Polymarket CEO Shayne Coplan recently stated on X that the platform had been “given the green light to go live in the USA by the CFTC.”
