On Friday, a Nevada state judge extended a temporary ban on Kalshi's sports-related prediction contracts in the state. Judge Jason Woodbury of the First Judicial District Court granted the Nevada Gaming Control Board's request for a preliminary injunction against Kalshi, preventing the company from offering certain prediction markets until the state gaming regulator's court case is resolved. The judge initially blocked Kalshi from offering sports, entertainment, and election-related bets with a temporary restraining order on March 20, which has now been extended by two weeks to finalize the injunction's language. According to Reuters, buying a contract for a baseball game on Kalshi is 'indistinguishable' from placing a bet on a state gaming platform, leading the judge to conclude that it constitutes prohibited gaming activity for non-licensed entities.
Kalshi spokespeople did not respond to requests for comment. Mike Dreitzer, chairman of the Nevada Gaming Control Board, expressed satisfaction with the ruling and reaffirmed the board's commitment to enforcing state law to protect gaming in Nevada.
The board views sports event contracts as wagering activities under local laws, requiring licensing. The ruling reflects Nevada's public policy of licensing, controlling, and assisting the gaming industry to protect public health, safety, and welfare. State regulators have been working to block prediction market providers across the US, arguing that their sports-related products are essentially gambling products that should be regulated at the state level.
Companies like Kalshi argue that they are federally regulated designated contract markets offering swaps, a type of derivative product, and thus are not subject to state regulators. The Commodity Futures Trading Commission supports this stance, recently filing an amicus brief and suing Arizona, Illinois, and Connecticut, arguing that it is the proper regulator and that states are overstepping their authority. A related hearing took place in a federal court in Arizona, where Kalshi sought to block state regulators from taking action against its products. Arizona Attorney General Kris Mayes had previously filed allegations of criminal charges against Kalshi.
The court is currently considering the motion.