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A Washington state judge has granted a preliminary injunction blocking Kalshi from offering its event contracts in the state, marking another setback for the prediction market operator as legal fights spread across the US.
Judge John McHale of King County Superior Court sided with Washington, finding the state showed a likelihood of “actual and substantial injury” to consumers from illegal gambling activities if the injunction were not issued. The court also found that the public interest and potential consumer harm outweighed the harm to Kalshi.
Washington Attorney General Nick Brown called the ruling “the first step toward holding Kalshi accountable.” In a statement cited by the source report, Brown said Kalshi promoted illegal betting on sports, elections, the total number of measles cases this year, what witnesses would say during a child trafficking hearing, and natural disasters.
Kalshi pushed back, saying states do not have jurisdiction to regulate prediction markets.
The ruling adds Washington to a growing list of states that have won court orders restricting Kalshi’s activities, including Massachusetts, Michigan and Nevada. New York also won a similar order on July 8, when a federal judge rejected Kalshi’s attempt to block enforcement of that state’s gambling laws.
At the center of these disputes is a broader jurisdiction fight. The US Commodity Futures Trading Commission has claimed exclusive authority over the industry and has challenged regulatory activity in at least nine states, according to the source report. In April, a divided federal appeals court cited the CFTC’s authority when it blocked New Jersey gaming authorities from regulating Kalshi’s sports event contracts.
For players, the immediate takeaway is straightforward: Kalshi’s event contracts are set to remain unavailable in Washington while the case moves forward. The judge said he plans to issue an order implementing the injunction on Aug. 5.
The case is part of a wider debate over whether prediction markets should be treated as gambling under state law or as federally regulated financial products. That question has become more prominent as prediction markets such as Kalshi and Polymarket have grown in popularity. According to Dune Analytics, about $19.04 billion was wagered through Kalshi and Polymarket on the recently completed soccer World Cup.
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Source: As reported by nypost.com.
