Key Points
- A Nevada court granted a 14-day temporary restraining order against Kalshi on Friday, March 20
- The directive blocks Kalshi from offering sports, entertainment, and election-based contracts within Nevada
- Nevada’s Gaming Control Board initially ordered Kalshi to cease sports contract offerings in 2025
- Federal regulators claim jurisdiction over prediction markets, creating conflict with state authorities
- Arizona prosecutors filed charges against Kalshi for operating an unlicensed gambling platform this week
The prediction market operator Kalshi must suspend its event contract offerings in Nevada for a minimum of 14 days following a court decision. Nevada’s First Judicial District Court granted the temporary restraining order last Friday.
Kalshi was temporarily barred by a judge from offering its prediction market contracts in Nevada, after state regulators said the company didn’t have a gaming license. https://t.co/in8URVlJWj
— Bloomberg (@business) March 20, 2026
The judicial order applies to all sports, entertainment, and election-related contracts available through the platform. Court proceedings will resume on April 3 with a follow-up hearing.
This legal battle has roots stretching back to 2025, when Nevada’s Gaming Control Board first directed a cease-and-desist order to Kalshi. The board demanded the company halt all sports-related event contracts offered to Nevada residents.
Kalshi challenged the state action, contending that federal oversight supersedes state jurisdiction. The platform operator attempted to transfer the proceedings to federal court.
That strategy proved unsuccessful. The U.S. Court of Appeals for the Ninth Circuit rejected Kalshi’s request for a stay on Thursday and remanded the matter back to Nevada state court.
The Nevada district judge determined that the gaming board’s regulatory mission is compromised while Kalshi operates within state borders without proper licensing. According to the ruling, an “unlicensed participant beyond the Board’s control” undermines the agency’s statutory obligations.
Kalshi representatives did not provide a statement regarding the Nevada court decision.
Federal Regulators Assert Control
On the federal front, Commodity Futures Trading Commission Chair Michael Selig has actively challenged state enforcement actions. He submitted a legal brief maintaining that the CFTC, rather than individual states, possesses proper regulatory authority over prediction market platforms.
Selig has repeatedly articulated this position during public appearances and pledged ongoing federal assertion of regulatory control. The commission has additionally released formal guidance reminding prediction market platforms that they must comply with Commodity Exchange Act provisions.
Major League Baseball has aligned with the federal regulatory framework, executing a memorandum of understanding with the CFTC regarding prediction market supervision. MLB concurrently announced a collaborative agreement with Polymarket this week.
Expanding State Actions
Nevada represents just one jurisdiction pursuing legal action against Kalshi. Arizona’s attorney general filed criminal charges against the company earlier this week for operating an unlicensed gambling enterprise and facilitating illegal election wagering.
Tennessee authorities have similarly initiated legal proceedings against prediction market platforms over sports event contracts.
Federal legislators have also expressed apprehension. Democratic Representative Ritchie Torres proposed legislation in January designed to restrict how elected officials engage with prediction markets, prompted by wagering activity related to former Venezuelan President Nicolás Maduro’s potential capture.
Last week, Democratic legislators unveiled the “Death Bets Act,” proposing to prohibit prediction market contracts connected to death, armed conflict, or assassination.
The Nevada court acknowledged that federal preemption questions in this regulatory space remain “nuanced and rapidly evolving.”
The Nevada case returns to court on April 3, 2026.
