Kalshi has suffered another setback in its U.S. legal battle over prediction markets. According to The Block, a Washington state court on Aug. 13 issued a formal order requiring the company to stop offering most categories of prediction market contracts in the state. On the same day, the city of Baltimore also sued Kalshi and other firms, extending the dispute over whether prediction markets amount to illegal gambling across more jurisdictions.
Washington order blocks most categories
The Washington court found that Kalshi likely violated the state’s gambling laws and said its marketing practices amounted to unfair or deceptive conduct. Under the order, Kalshi must stop offering contracts tied to sports, elections and politics, entertainment and culture, and technology and science in the state, along with event-reference products tied to those categories.
Contracts related to commodities, climate, the economy, and finance are still allowed to remain available.
For compliance, Kalshi must establish geofencing based on IP address and residency by Aug. 19, implement a multi-source geofencing system by Sept. 2, and stop promoting restricted wagers to consumers in Washington.
The formal order stems from a preliminary injunction issued in July. The Block said it had reached out to Kalshi for comment.
Baltimore lawsuit widens pressure
Also on Aug. 13, Baltimore filed suit against Kalshi, Polymarket, Coinbase, Robinhood, and Webull, with allegations that again center on illegal gambling.
Viewed together, the cases show local governments and state courts applying pressure on prediction market platforms from New York to Washington and now Baltimore. At the federal level, the Commodity Futures Trading Commission, or CFTC, had previously used emergency authority to support Kalshi and argued that prediction markets fall under exclusive federal jurisdiction.
The fight over who has authority to regulate these products, and whether they should be treated as gambling, is still unresolved.