NY Sues Kalshi, Demanding $100K Fine Per Illegal Bet

The State of New York has initiated legal action against Kalshi, one of the largest prediction-market platforms in the U.S., accusing it of running an unlicensed gambling operation. The lawsuit, filed on Friday, argues that Kalshi’s event contracts meet the legal definition of gambling because outcomes are uncertain and outside the bettor’s control. New York contends Kalshi failed to obtain a gambling license from the state commission, does not pay taxes like licensed platforms, and allowed users under 21 to bet—violating state law that requires bettors to be at least 21 for mobile sports wagering. Governor Kathy Hochul stated that Kalshi chose to ignore state gambling protections, emphasizing that no company is above the law. Attorney General Letitia James said that regardless of the label, prediction markets like Kalshi are gambling platforms harming New Yorkers. The lawsuit seeks to ban Kalshi from operating in New York, full restitution for affected customers, damages, and a penalty of $100,000 for each unauthorized wagering offer, plus three times the platform’s gains from its violations. This action comes amid a broader regulatory dispute: 44 state attorneys general have argued that the Commodity Futures Trading Commission (CFTC) lacks authority over sports betting on these platforms, while the CFTC asserts exclusive jurisdiction under federal law. CFTC Chairman Michael S. Selig has warned that the agency will challenge any state attempt to seize authority over these markets.

Source: https://news.bitcoin.com/regulation-and-legal/ny-sues-kalshi-demanding-100k-fine-per-illegal-bet/