A Nevada judge has extended a prohibition against Kalshi offering event-based contracts to state residents, ruling that the products amount to unlicensed gambling under Nevada law. Judge Jason Woodbury announced at a hearing in Carson City on Friday that he would grant a preliminary injunction sought by the Nevada Gaming Control Board. The order bars the company from allowing residents to trade on outcomes tied to sports, elections, and entertainment events without holding a gaming license.
The ruling builds on a temporary restraining order that was first issued on March 20. That order will remain in place through April 17 while the court works to finalize longer-term restrictions. The case represents the first instance in which a state has secured a court-enforced ban currently active against the company.
Kalshi, headquartered in New York, has maintained that its products are financial derivatives — specifically “swaps” — that fall exclusively under the jurisdiction of the Commodity Futures Trading Commission (CFTC). The company argued that federal oversight of such instruments preempts state-level regulation. Judge Woodbury rejected that position, finding a direct functional equivalence between Kalshi’s contracts and conventional sports wagering.
The judge drew a pointed comparison between placing a bet through a licensed sportsbook and purchasing a contract linked to a game’s outcome, concluding the two activities are effectively identical. “No matter how you slice it, that conduct is indistinguishable,” Woodbury reportedly said. He added that such activity qualifies as gaming under Nevada law and cannot be offered without the appropriate licensing in place.
Nevada is not the only state moving against prediction market platforms. Last month, Utah lawmakers passed legislation targeting Kalshi and Polymarket, classifying proposition-style bets on in-game events as gambling and seeking to block those offerings within the state. The back-to-back legislative and judicial actions signal growing momentum among states to assert regulatory authority over the sector.
At the federal level, the CFTC has staked out its own claim over prediction markets. Chairman Michael Selig has warned that the agency is prepared to defend its jurisdiction in court against challenges from states or other regulators. Speaking at an industry conference last month, Selig described prediction markets as potential “truth machines,” arguing that when participants commit money to their positions, the resulting signals about future events can be more transparent and reliable than traditional opinion polling.
The competing claims of authority between federal and state regulators place Kalshi at the center of a broader legal dispute over how event-based contracts should be classified and governed. The outcome of the Nevada proceedings, as the court moves toward finalizing longer-term restrictions, is likely to carry implications for the wider prediction market industry operating across the United States.
Originally reported by CoinTelegraph.
