Kalshi's Bid to Block New York Gambling Laws Rejected by Federal Judge

A federal judge in Manhattan has dismissed Kalshi’s application to prevent New York state from enforcing its gambling regulations against the prediction platform. US District Judge Analisa Torres denied Kalshi’s motion for a preliminary injunction, asserting that the federal Commodity Exchange Act does not take precedence over New York's gambling statutes regarding the platform’s sports-event contracts.

Judge Torres’s decision emphasized that New York’s compelling interests in mitigating gambling addiction, safeguarding the integrity of sports, and preventing the proliferation of unregulated contracts significantly outweigh Kalshi’s interest in upholding the supremacy of federal law. This ruling marks a notable development in the ongoing regulatory discussions surrounding prediction markets.

Following the court's decision, New York Governor Kathy Hochul and Attorney General Letitia James issued a joint statement. They welcomed the outcome, reiterating the state’s commitment to consumer protection. "We will continue to hold all gambling platforms accountable to the law — and that includes prediction markets," they stated.

In a separate but related legal action, Michigan Attorney General Dana Nessel has also taken steps against Kalshi. Nessel successfully obtained a temporary restraining order from the Ingham County Circuit Court, which prohibits Kalshi from offering or promoting online sports wagers within the state of Michigan.