New York sues Kalshi for allegedly running an ‘illegal gambling operation’

Core Impact Points

• New York joins Nevada, New Mexico, Arizona, Washington, and others in suing Kalshi, a prediction market platform.
• The lawsuit alleges Kalshi exposes New York residents to serious personal and financial risk, including those under the legal gambling age of 21.
• Kalshi has sparked concerns over insider trading, with President Donald Trump's teleprompter operator making $100,000 in bets related to Trump's speeches.
• The Commodity Futures Trading Commission (CFTC) claims exclusive jurisdiction over prediction markets, but many states argue this authority doesn't apply to sports wagering.
• Some states, such as Wisconsin, Illinois, and Rhode Island, have attempted to introduce laws regulating Kalshi and other prediction markets like Polymarket.
• The lawsuit seeks to block Kalshi from operating in New York and to pay restitution to customers who placed bets on the platform.