New York Sues Kalshi, Labeling Prediction Market an Illegal Casino

The state’s complaint centers on Kalshi’s accessibility, specifically its allowance of 18-year-old users on a platform where New York law dictates a minimum age of 21 for gambling. Attorney General James argued that the company’s business model ignores state penal statutes, demanding a permanent injunction against its operations unless it secures proper licensing from the New York State Gaming Commission. The state is also seeking a full accounting of all bets and customer losses, alongside financial penalties for the alleged violations.

Governor Kathy Hochul backed the legal action, asserting that prediction markets must adhere to the same consumer protection rules as any other gaming entity. This clash highlights a growing regulatory divide, as the Trump administration has actively shielded such platforms from state-level oversight. CFTC Chair Michael Selig has repeatedly warned that federal law preempts state attempts to regulate these markets, threatening litigation against states like Wisconsin, Arizona, and now New York to protect the industry from local restrictions.