Prediction-market platform Kalshi files lawsuit against New York regulators… "Abuse of authority"

The decentralized prediction platform Kalshi has filed a lawsuit against the New York State Gaming Commission. It argues that the state's order to cease operations, claiming it offered illegal sports betting, is an action beyond its authority.

On the 27th (local time), Cointelegraph reported that Kalshi stated in a complaint filed in a Manhattan federal court, "We are a legitimate exchange regulated by the U.S. Commodity Futures Trading Commission (CFTC), and the state has no authority to regulate us."

Earlier, the New York State Gaming Commission on the 24th ordered the immediate cessation of services and a ban on advertising, claiming Kalshi operated an unlicensed sports betting platform within New York. Kalshi said this was "an action that infringes on the federal derivatives regulatory framework" and requested a preliminary injunction and a permanent injunction from the court.

Kalshi argued that "New York's action violates the constitutional federal preemption principle (field preemption·conflict preemption)," adding that "such interference causes immediate and irreparable harm." It added that "blocking New York users would require complex and untested technical measures that threaten the platform's very existence."

Kalshi is already engaged in similar legal disputes with regulators in Nevada, New Jersey, Maryland, and Ohio, and is defending against sports betting law violations in Massachusetts. In Nevada and New Jersey, Kalshi won a first preliminary injunction, temporarily blocking state sanctions.