Kalshi Gains Temporary Win Against Nevada Gaming Commission

Kalshi has achieved a significant, though temporary, victory in its ongoing legal confrontation with Nevada regulators. A federal judge’s decision allows the company to continue offering sports-based event contracts in the state for the time being.

On April 8, 2025, U.S. District Court Chief Judge Andrew P. Gordon issued a minute order partly granting Kalshi’s request for a temporary restraining order and preliminary injunction. The ruling stops the Nevada Gaming Commission (NGC) from enforcing its cease-and-desist notice against Kalshi, which had threatened to shut down the platform’s sports prediction markets.

Although a full written opinion is still pending, Judge Gordon’s order simultaneously denied the NGC’s motion for an emergency injunction against Kalshi. As a result, Kalshi can maintain its Nevada operations while broader legal proceedings unfold.

A Kalshi spokesperson commented on the development, stating, “Today, the Federal Court in Nevada granted Kalshi’s preliminary injunction and blocked the State from trying to prevent Kalshi from offering prediction markets. We are grateful for the court’s careful attention to this matter and recognition of Kalshi’s status as a CFTC-regulated exchange. On to the next step.”

The Nevada Gaming Commission has not yet provided any public response to the court’s decision.

Federal Oversight vs. State Authority

Kalshi operates under federal jurisdiction as a Designated Contract Market (DCM) regulated by the Commodity Futures Trading Commission (CFTC). Following a major legal win against the CFTC in 2023, Kalshi secured permission to list political event contracts, including markets tied to U.S. elections. That outcome set a precedent confirming the legitimacy of such platforms under federal commodities law.

Building on that momentum, Kalshi expanded into sports prediction markets, offering contracts related to major sporting events like the Super Bowl and NCAA’s March Madness. This expansion included a high-profile partnership with Robinhood, which enabled s to trade on sports outcomes during March Madness earlier this year.

However, this move drew immediate resistance from state regulators. Nevada, alongside New Jersey, Illinois, Maryland, Ohio, and Montana, issued cease-and-desist letters to Kalshi, Robinhood, and Crypto.com. These states argue that offering event contracts tied to sports outcomes constitutes unlicensed sports betting, subject to state gambling laws.

Kalshi countered by filing federal lawsuits against Nevada and New Jersey, asserting that its status as a federally regulated exchange shields it from such state-level regulatory actions.

A Defining Legal Battle for Prediction Markets

The case underscores a growing conflict over regulatory authority in the prediction markets space. At its core, the dispute hinges on whether event-based trading platforms should be treated as financial exchanges or as gambling operations.

Kalshi insists that its operations differ fundamentally from traditional sports betting, arguing that its contracts are financial products regulated under federal commodities law. “We are literally like a financial exchange, but the underlying trading is events. The CFTC is our regulator. If the CFTC tells us to stop, we will absolutely stop. If they don’t, then we won’t,” Kalshi co-founder and CEO Tarek Mansour told TechCrunch last week.

On the other hand, state regulators maintain that bets on athletic events fall squarely under their jurisdiction and should comply with existing gambling regulations.

Although the Nevada court’s decision is not a final resolution, the preliminary injunction allows Kalshi to continue operating in the state and could influence similar disputes elsewhere. Future rulings—or possibly even a Supreme Court intervention—may determine how event-based prediction markets are regulated nationwide.

Kalshi’s Growth and Political Strategy

Amid its legal efforts, Kalshi has also worked to solidify its presence both commercially and politically.

In January, the company named Donald Trump Jr. as a strategic advisor, signaling deeper engagement with Washington’s political circles. More recently, Kalshi appointed Sara Slane as its Head of Corporate Development. Slane, who formerly served as the American Gaming Association’s senior vice president of public affairs, was instrumental in the legalization of sports betting following the Supreme Court’s 2018 repeal of the federal ban.

In a LinkedIn post, Slane wrote, “Never in my career have I seen a company with the combination of characteristics that Kalshi has: bold vision, outlier founders, deep commitment to regulatory compliance, and astronomical growth.”

Her addition to the leadership team is anticipated to further strengthen Kalshi’s relationships with lawmakers, regulators, and sports organizations as it navigates the evolving regulatory environment.

For now, the preliminary victory in Nevada marks an important milestone for Kalshi, though many legal hurdles remain. The CFTC is expected to release further guidance on sports event contracts by the end of May.

Source:

Judge rules against gaming regulators on sports event contracts, reviewjournal.com, April 10, 2025.