Massachusetts Takes Legal Action Against Kalshi Over Alleged Illegal Sports Betting

The Commonwealth of Massachusetts has initiated a legal complaint in state court against Kalshi, asserting that the platform is conducting unlicensed sports betting, disguised as event contracts.

Massachusetts Attorney General Andrea Joy Campbell emphasized, "Kalshi must secure a license and adhere to state regulations if they wish to engage in sports wagering in Massachusetts."

In its legal plea, the state seeks a judicial order to bar Kalshi from operating in Massachusetts during the ongoing litigation.

Event contracts, considered a form of prediction market, are under the jurisdiction of the Commodity Futures Trading Commission (CFTC). Kalshi has frequently contended that the CFTC, being a federal entity, holds authority over state regulations.

In documents submitted to the Suffolk County Superior Court, Massachusetts contends that Kalshi is generating more revenue from sports betting compared to licensed sports betting operators.

The legal complaint reveals that around 70% of Kalshi’s trade volume from February to mid-May 2025 consists of sports events, climbing to 75% following the introduction of single-game March Madness options in mid-March. Kalshi reportedly outperformed licensed betting platforms in revenue during this same period.

According to a spokesperson for Kalshi, $439 million was wagered on NFL-related contracts thus far, reported during a CNBC interview earlier this week.

Kalshi has been advocating for the legitimization of sports prediction markets nationwide. The firm recently defended its stance at the 3rd Circuit Court of Appeals, in response to New Jersey’s attempt to enforce a cease-and-desist order against its operations.