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Gaming Edge’s TL;DR
- Kalshi lost its bid for a preliminary injunction in New York federal court, meaning the company did not win immediate relief from state gambling enforcement in that case.
- The ruling adds to a growing split across US courts over whether event contracts should be treated as federally regulated financial products or as activity states can police under gambling law.
A federal judge in New York has denied Kalshi’s request to stop the state from enforcing its gambling laws against the company’s event contracts.
In the case KalshiEX LLC v. Williams, Kalshi had asked the court for a preliminary injunction that would have blocked New York from taking enforcement action against its event contracts while the case moves forward.
That request was denied.
New York had previously issued cease-and-desist orders against Kalshi. The new ruling means the company did not secure early court protection against those state gambling-law efforts.
This is not happening in isolation. The dispute over prediction markets has produced conflicting outcomes in several jurisdictions. They include:
- Third Circuit affirmed a preliminary injunction for Kalshi in New Jersey on April 6
- Courts denied Kalshi a preliminary injunction in March in Ohio
- A preliminary injunction was denied in August 2025 in Maryland
The result is a legal map that looks anything but settled.
CFTC has intervened in several cases
At the center of these cases is a basic but high-stakes question: Are prediction market event contracts governed primarily as federal financial products, or can states treat them as gambling operations?
That question matters because it affects where platforms may be able to operate and which regulators have the stronger hand. The Commodity Futures Trading Commission (CFTC) has intervened in multiple cases to support its jurisdiction, underscoring how closely federal oversight is tied to the broader fight.
Kalshi’s New York loss is another sign that access and enforcement may continue to vary by state while courts reach different conclusions. In practical terms, operators and market participants are still facing a fragmented US landscape rather than one clear national rulebook.
Based on reporting by Crypto Briefing.
