A Washington state judge has granted a request to block the prediction market platform Kalshi from offering its event contracts within the state, ruling that the service likely violates the state's gambling laws. The decision, issued Monday by Judge John McHale of the King County Superior Court, cites a potential for substantial injury to Washington consumers engaging in illegal gambling.
The preliminary injunction aims to prevent further harm to consumers, with the court finding that the public interest and potential consumer harm outweigh any harm to Kalshi. The judge indicated he plans to issue a formal order implementing the injunction on August 5.
Washington is the latest state to secure a court order restricting Kalshi's operations. Similar rulings have been issued in Massachusetts, Michigan, and Nevada. In New York, a federal judge rejected Kalshi's attempt to block the enforcement of state gambling laws against the platform.
Kalshi has contested these state-level regulations, asserting that states lack the jurisdiction to regulate prediction markets. The company stated that it is disappointed by Washington's actions, which it described as a waste of taxpayer dollars. The US Commodity Futures Trading Commission (CFTC) has also asserted exclusive jurisdiction over the industry, challenging regulatory actions in at least nine states. Previously, a federal appeals court cited the CFTC's authority in blocking New Jersey gaming authorities from regulating Kalshi's sports event contracts.
Washington Attorney General Nick Brown praised the ruling, calling it a significant step toward holding Kalshi accountable. He accused the platform of profiting from what he termed illegal betting on a wide range of events, including sports, elections, public health statistics, and even natural disasters. Prediction markets like Kalshi and Polymarket allow users to wager on the outcomes of future events. Their popularity has reportedly surged, particularly following the 2024 US presidential election, where they were noted for accurately predicting Donald Trump's victory. Data suggests significant sums have been wagered on various events through these platforms, including the recent soccer World Cup.