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 temporary restraining order, initially granted on March 20, has been extended by two weeks to finalize the injunction's language.
The original order blocked Kalshi from offering sports, entertainment, and election-related bets. According to the judge, purchasing a contract for a baseball game on Kalshi is essentially the same as placing a bet on a state gaming platform. The judge stated that this activity is prohibited for non-licensed entities, and therefore, it is a gaming activity.
Kalshi's representatives 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 under local laws, requiring licensing.
The ruling is part of a larger effort by state regulators to block prediction market providers, arguing that their sports-related products are essentially gambling products that should be regulated at the state level. In contrast, companies like Kalshi argue that they are federally regulated and offer swaps, a type of derivative product, making them exempt from state regulation. The Commodity Futures Trading Commission has taken a stance supporting these companies, filing an amicus brief in an appeals court case and suing Arizona, Illinois, and Connecticut, alleging that the states are overstepping their authority.