New York targets Kalshi, arguing its prediction market is illegal gambling

New York Attorney General Letitia James filed a state-court suit against Kalshi, alleging the online prediction market operates as illegal gambling because Kalshi did not obtain a NY gambling license or pay taxes. The state seeks an injunction, fines, restitution, and the forfeiture of profits. Kalshi countered that the case is politically motivated and noted federal regulation via the CFTC. The dispute highlights a broader clash between state gambling laws and federal oversight of prediction markets, with related actions in Rhode Island and ongoing court battles over jurisdiction between NY and the CFTC.