Connecticut Targets Kalshi Again: New Lawsuit Aims to Block Sports Event Contracts

Connecticut has filed a new lawsuit against the prediction market platform Kalshi, seeking to block the platform from offering event contracts featuring sports in the state. The lawsuit, filed by the Office of the Attorney General and signed by Attorney General William Tong, argues that sports event contracts constitute gambling and that Kalshi is not regulated by the Connecticut gambling regulator. Therefore, its product is illegal.

Kalshi has rebuffed these claims, arguing that it is regulated under the Commodity Futures Trading Commission (CFTC) and that, as such, it is not subject to state gaming laws. In a statement, the AG’s office argued that sports event contracts resemble sports wagers, and that the specifics of each contract hewed too closely to what traditional sportsbooks offer, such as the number of points scored and more. Bluntly, the statement equated prediction markets in their current forms about sports events to gambling.

This is not the first time Kalshi has faced legal challenges in Connecticut. In December, the state consumer protection agency ordered the platform, along with others, to cease conducting their business in the state, specifically sports event contracts. Kalshi launched a lawsuit against the state at the time, insisting that only the CFTC could weigh in on what constituted regulated and unregulated products.