Prediction market Kalshi has been ordered to stop much of its business in Washington state after a judge found that many of its event contracts amount to gambling under state law.
A King County Superior Court judge issued a final order requiring Kalshi to stop offering several types of contracts to Washington residents. The decision follows an earlier preliminary injunction secured by the Washington Attorney General’s Office, which argued that Kalshi was operating without the licenses required under state gambling laws.
The restrictions cover some of Kalshi’s most popular markets, including contracts tied to sports events, awards, political contests and other outcomes that the state considers wagering.
The case centers on a bigger question for the rapidly growing prediction market industry. Kalshi operates as a federally regulated exchange overseen by the Commodity Futures Trading Commission, but Washington argues that federal regulation does not allow the company to bypass state gambling laws.
The ruling could therefore matter well beyond Washington if other states pursue similar challenges against prediction platforms.
