Kalshi faces Nevada setback as judge rejects defense

A Nevada court has moved to keep Kalshi out of the state’s event-contract market while the legal fight continues. 

The ruling came after the Nevada Gaming Control Board asked the court to block the company from offering contracts tied to sports, elections, and entertainment outcomes.

The case adds to a wider debate over whether prediction market contracts fall under federal derivatives law or state gambling rules. Kalshi has said its products are financial contracts, while Nevada regulators have argued that the offerings match gambling activity under state law.

Judge Jason Woodbury said he would grant a preliminary injunction against Kalshi at a hearing in Carson City. According to Reuters, the order prevents the company from allowing Nevada residents to trade event contracts without a gaming license.

The move extends a temporary restraining order issued on March 20. That order will stay in effect through April 17 while the court completes the next steps in the case.

Kalshi had argued that its contracts are “swaps” and fall under the oversight of the Commodity Futures Trading Commission. The company has maintained that federal law gives the CFTC authority over these products.

The judge did not accept that position. Reuters reported that Woodbury said buying a contract tied to a game result is the same as placing a wager through a sportsbook. He said, “No matter how you slice it, that conduct is indistinguishable.”

State regulators score early court win

The ruling marks the first time a state has secured a court-enforced ban that is currently active against Kalshi. That gives Nevada an early legal win as more states question prediction markets tied to sports and similar events.

Utah has also moved against the sector. Lawmakers there passed a bill last month that classifies proposition-style bets on in-game events as gambling and seeks to block such products from platforms including Kalshi and Polymarket.

The dispute also comes as the CFTC continues to defend its role in prediction markets. CFTC Chairman Michael Selig said last month that the agency is ready to fight in court to protect its jurisdiction from states and other regulators.

Selig also described prediction markets as “truth machines” during an industry conference. He said markets where users risk money on outcomes can offer a clearer signal about future events than opinion polls, setting up a sharper clash between federal oversight claims and state gaming laws.