New York sues Kalshi for alleged 'illegal gambling operation' - ESPN

Legal challenges mounted Friday for Kalshi when New York sued it for allegedly running an «illegal gambling operation» in the state and sought severe financial penalties against the prediction market company.

Letitia James, the attorney general of New York, alleged that Kalshi's offerings are «quintessentially gambling» and that the prediction market exposed New Yorkers, including those under 21, to gambling addiction without adequate safeguards.

Kalshi and its closest competitor, Polymarket, face at least 20 lawsuits from state regulators, tribes and individuals. They have long insisted that their service constitutes commodities trading, not gambling. The Donald Trump administration has defended that position, arguing that regulation of prediction markets falls under the jurisdiction of the Commodity Futures Trading Commission.

A Kalshi spokesperson, in a statement, referred to the lawsuit as a type of «political theater.»

In a six-episode series, 30 for 30 Podcasts examines how Shohei Ohtani's relationship with his longtime interpreter Ippei Mizuhara unraveled amid a massive sports betting scheme. Listen now.

«States can't just shut down a federally licensed exchange,» the statement read. «This would also just hurt New Yorkers, who would be driven offshore. We love New York, we love New Yorkers, and New Yorkers love our product.»

James, in the legal filing, petitioned the court to permanently prohibit Kalshi from operating in the state, where it's currently headquartered, unless the company obtains a gaming license. In April, New York sued prediction markets Coinbase and Gemini Titan based on the same gambling allegation.

«New York's gambling laws protect children from underage betting and help combat gambling