Massachusetts Sues Kalshi Over Alleged Unlicensed Sports Gambling

Massachusetts Attorney General Andrea Joy Campbell has initiated legal action against Kalshi, a New York-based derivatives trading company, accusing it of operating an illegal sports wagering platform within the state. The lawsuit contends that Kalshi offers sports betting disguised as event contracts without obtaining the necessary licensing from the Massachusetts Gaming Commission.

"If Kalsi wants to be in the sports gaming business in Massachusetts, they must obtain a license and follow our laws," Campbell stated in a news release.

The state is seeking a court order to prevent Kalshi from offering sports event contracts in Massachusetts while the lawsuit is pending.

Kalshi, regulated by the Commodity Futures Trading Commission (CFTC) as a predictions market, has argued in federal court that the CFTC's federal status supersedes state regulators.

The lawsuit also alleges that Kalshi's operations pose public health risks and fail to comply with state consumer protection laws, including age restrictions. Kalshi permits users aged 18 and over, while Massachusetts mandates a minimum age of 21 for online sports wagering.

Additionally, the state argues that Kalshi is making more money on sports wagers than legal, licensed sportsbooks.

Kalshi has not yet responded publicly to the lawsuit.