Kalshi, a platform for prediction markets, is facing legal challenges in Massachusetts after a judge ruled that it cannot offer sports betting services to residents. This preliminary injunction was reportedly requested by Massachusetts Attorney General Andrea Joy Campbell.

According to a Reuters report, Judge Christopher Barry-Smith of the Suffolk County Superior Court has enforced this injunction against Kalshi, stating it must not operate sports betting without the necessary gaming license.

The legal action follows a lawsuit filed by Attorney General Campbell in September, accusing Kalshi of providing “illegal and unsafe sports wagering.” The injunction was put in place at her request.

Sample of bets on Kalshi as of Tuesday. Source: Kalshi

Kalshi is recognized as one of the largest prediction market platforms globally, competing with others like Polymarket. Both services allow users to bet on a wide range of events, including political outcomes and sports results.

Other Legal Actions Against Prediction Markets

The lawsuit against Kalshi is part of a broader scrutiny by various states and federal lawmakers against prediction market platforms that largely operate without regulation. Even after achieving a legal victory against the U.S. Commodity Futures Trading Commission (CFTC) in 2024 regarding election bets, Kalshi continues to face significant regulatory pressure.

In January, a user on Polymarket made over $400,000 from a contract related to the potential removal of former Venezuelan President Nicolás Maduro by U.S. forces, which raised concerns over possible insider trading and conflicts of interest, fueling further legal discussions on who may participate in political prediction markets.

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