A federal judge has ruled that Utah can enforce its strict anti-gambling laws on prediction markets, a decision that supports states seeking to regulate platforms such as Kalshi and Polymarket. U.S. District Judge Robert Shelby rejected Kalshi's request to block Utah's restrictions, stating that the federal law cited by the company does not prevent the state from enforcing its own regulations.
Kalshi had sued Utah in February, seeking to prevent the state from applying its gambling restrictions to the platform. The lawsuit followed Utah's move toward legislation aimed at preventing prediction markets from operating within the state. Utah law already prohibits proposition betting in sports, a revenue source for many prediction markets.
While the ruling allows Utah to enforce its laws, Utah Attorney General Derek Brown indicated that the state is still exploring its options regarding enforcement against Kalshi. "Gambling is gambling, no matter what any company calls it," Brown stated.
Kalshi expressed disagreement with the ruling and announced plans to appeal. The company maintains that prediction markets fall under federal jurisdiction and are not subject to varying state gambling laws, a position supported by the Commodity Futures Trading Commission. The legal landscape for prediction markets remains divided, with courts in several states siding with Kalshi, while others have ruled against the platform.
Utah's approach to regulating prediction markets has been framed by state leaders, including Gov. Spencer Cox, as a moral initiative, influenced by the cultural values of the Church of Jesus Christ of Latter-day Saints, which views gambling as detrimental. Cox celebrated the ruling, stating that prediction markets "cause tremendous harm to countless American families."