Legal Hurdles for Kalshi: Michigan Blocks Sports Betting Operations

A Michigan judge has temporarily halted Kalshi's sports betting operations in the state, following allegations of violating gaming laws. The restraining order demands adherence to geolocation requirements, with fines for non-compliance. Kalshi plans to challenge the decision, arguing federal jurisdiction over state gaming regulations.

A Michigan judge has issued a temporary restraining order against prediction market operator Kalshi, effectively halting its sports betting operations within the state. The decision comes after Attorney General Dana Nessel accused the company of breaching state gaming laws.

Judge Rosemarie Aquilina ruled that Kalshi must comply with geolocation mandates, with penalties of $120,000 for each day of non-compliance. The order positions Michigan as the second state, after Nevada, to enforce a court-ordered ban on Kalshi, which is facing similar challenges in Massachusetts.

Kalshi, valued at $22 billion, is set to contest the ruling, asserting that the U.S. Commodity Futures Trading Commission has exclusive jurisdiction over its operations. Nevertheless, state regulators argue that firms like Kalshi are operating without necessary state licenses, contravening gaming laws and age restrictions.