On Friday, a Nevada state judge extended a temporary ban on Kalshi, a prediction market provider, from offering sports-related contracts in the state. Judge Jason Woodbury granted the Nevada Gaming Control Board's request for a preliminary injunction against Kalshi, preventing the company from offering certain prediction markets until a broader court case can be resolved. The initial temporary restraining order, issued on March 20, blocked Kalshi from offering sports, entertainment, and election-related bets.
The judge compared buying a contract on a baseball game through Kalshi to placing a bet on a state gaming platform, deeming it a prohibited gaming activity for non-licensed entities. Kalshi spokespersons did not respond to requests for comment.
Mike Dreitzer, chairman of the Nevada Gaming Control Board, expressed satisfaction with the ruling, stating that the board will continue to enforce Nevada law to protect the state's gaming industry. The board considers sports event contracts to be wagering activities that require licensing under local laws. The ruling is part of a larger effort by state regulators to block prediction market providers, arguing that their sports-related products constitute gambling and should be regulated at the state level. In contrast, companies like Kalshi claim to be federally regulated designated contract markets offering swaps, a type of derivative product, and therefore exempt from state regulation.
The Commodity Futures Trading Commission has sided with these companies, filing an amicus brief in an appeals court case and suing Arizona, Illinois, and Connecticut, arguing that it is the proper regulator. A separate hearing took place in a federal court in Arizona, where Kalshi sought to block state regulators from restricting its products, and Arizona Attorney General Kris Mayes had previously filed an information alleging criminal charges against the company.