WASHINGTON (dpa-AFX) - Connecticut has won a legal battle to apply its sports betting regulations to Kalshi's sports prediction markets after a federal judge rejected the company's request to block state enforcement.
U.S. District Judge Vernon Oliver ruled that Kalshi was unlikely to prove that Connecticut lacked the authority to regulate its sports-related contracts. The decision applies specifically to sports markets and does not cover other offerings on the platform, such as elections or news events.
Kalshi and other prediction-market platforms argue that their contracts function like financial products and therefore fall under the jurisdiction of the Commodity Futures Trading Commission (CFTC), rather than state gambling regulators. The CFTC has separately challenged efforts by Connecticut and other states to impose gambling regulations on prediction markets.
Connecticut officials welcomed the ruling, arguing that the state has both the authority and responsibility to protect consumers under its gambling laws. The decision adds to a growing legal dispute across the U.S. over whether prediction markets offering wagers on sports and other events should be regulated as financial exchanges or as gambling platforms.
The ruling follows a separate Washington state decision ordering Kalshi to stop offering sports betting and several other types of event contracts in the state, further increasing regulatory pressure on the company.
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