Kalshi picked up a real win in April. The Third Circuit Court of Appeals ruled that the Commodity Exchange Act preempts New Jersey’s gambling law as applied to Kalshi’s sports-related contracts. Translation: the CFTC regulates this stuff, not a state gaming commission, and New Jersey can’t touch it. That’s a legitimate headline for a company that’s been getting sued by half the country.
Cool story. Now check Nevada.
On July 1, the Nevada Supreme Court denied Kalshi’s emergency motion to stay the preliminary injunction that’s had the company blocked since spring. A district court judge already found Kalshi’s contracts “indistinguishable” from bets placed at a licensed Nevada sportsbook, and the state is now pushing for contempt sanctions, claiming Kalshi kept taking Nevada customers straight through the ban. It’s an active injunction with teeth, not a technicality sitting on a docket somewhere.
That’s the whole story in miniature. One federal appeals panel says Kalshi is shielded from state gambling law. A state supreme court, three months later, says not so fast. Both rulings are real. Neither one settles anything.
Zoom out and the record gets worse for Kalshi fast. Sports attorney Daniel Wallach tracked 23 judicial decisions on preliminary injunctions and restraining orders in prediction-market cases nationwide, and states won 19 of them — an 82.6% win rate that would get you laughed out of a parlay group chat. Michigan, Massachusetts, and Washington all have Kalshi blocked outright. Arizona escalated further in March and filed actual criminal charges, treating the company less like a fintech unicorn and more like a bookie working out of a strip mall.
We flagged this coming back in May, when states started fighting back instead of rolling over. It’s been the pattern ever since.
None of this has slowed anybody’s spreadsheet down. Kalshi controls roughly 83% of notional trading volume among CFTC-regulated prediction markets and set a single-event record in July with $223 million traded on one World Cup match. Investors doubled the company’s valuation from $11 billion to $22 billion in five months, which tells you exactly how much the market is pricing in “we might get locked out of Nevada permanently.”
CEO Tarek Mansour has said the quiet part out loud before: “State law doesn’t really apply” to Kalshi. Nineteen state losses later, that’s less a legal opinion and more a bet the company keeps making out loud.
DraftKings and FanDuel spent a decade and a fortune getting licensed state by state. Now they get to watch a rival try to skip the entire process through a federal loophole nobody wrote with sports betting in mind.
Washington’s attorney general posted the receipts on one of those 19 losses this week:
Wallach’s tally is the number that should be trending, not the trading volume. Kalshi isn’t proving prediction markets belong next to sportsbooks in the regulated world. It’s proving a well-funded company can survive on one favorable circuit ruling while losing almost everywhere else, as long as the backers stay patient and the lawyers never stop filing.
Nineteen states down, one company still up $11 billion in five months. Nobody here is winning cleanly, and Kalshi looks perfectly comfortable playing for the draw.
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