New York sues Kalshi over alleged illegal gambling operation

New York has sued prediction market platform Kalshi, alleging it operates an illegal, unlicensed gambling business by offering event contracts on sports, elections and other outcomes.The lawsuit seeks to stop Kalshi’s alleged illegal gambling operation in the state, require the company to forfeit illegal gains, pay restitution to users and pay civil penalties equal to three times those gains.“No matter what they call themselves, prediction markets like Kalshi are gambling platforms, plain and simple,” Attorney General Letitia James said in Friday’s statement. “We are taking them to court to uphold our laws and protect New Yorkers.”The lawsuit comes after the New York State Gaming Commission issued Kalshi a cease-and-desist order in October 2025, prompting the company to sue the regulator in federal court. A judge denied Kalshi’s request for a preliminary injunction in July, and an appeals court later rejected its bid to block enforcement while the appeal proceeds.Kalshi did not immediately respond to Cointelegraph’s request for comment.CFTC defends federal oversight of prediction marketsThe lawsuit adds to an escalating jurisdictional dispute over whether event contracts offered by...