New York Sues Kalshi: "Call It What You Want, Prediction Markets Are Gambling Platforms"

New York Governor Kathy Hochul and Attorney General Letitia James have sued prediction market platform Kalshi, seeking to have it declared an illegal gambling operation. The state alleges Kalshi lets users wager on sports, elections, and cultural events without a state Gaming Commission license — including users aged 18 to 20 (licensed New York sportsbooks can only take bets from age 21) and markets tied to the state's own college teams.

“Kalshi has chosen to ignore New York's gaming laws, which exist to protect consumers, prevent problematic gambling, deliver funding for critical public services, and ensure that every company plays by the same rules.”

— Kathy Hochul, Governor of New York

“No matter what they call themselves, prediction markets like Kalshi are gambling platforms, plain and simple.”

— Letitia James, Attorney General of New York

• The state wants Kalshi barred from running unlicensed gambling operations in New York
• Forfeiture of all illegally obtained gains, plus restitution to harmed consumers
• A fine equal to triple the company's profits, plus $100,000 for every unlawful wager

Kalshi called the suit "political theater from the leadership in our own state": according to communications head Elisabeth Diana, "states can't just shut down a federally licensed exchange" — Kalshi is regulated as a derivatives exchange by the CFTC, not as a state-level bookmaker. This isn't a first attempt: New York's Gaming Commission already issued a cease-and-desist back in October 2025, and a federal judge rejected Kalshi's bid to block state regulators twice, on July 7 and July 27, 2026. Meanwhile, a Minnesota court ruled in July 2026 that state bans on prediction markets likely violate the federal Commodity Exchange Act — so the nationwide picture is still far from settled. Binance.US is betting on prediction markets for its own comeback the same way, via a CFTC filing. More detail on the lawsuit is available via CoinDesk.

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