The Nevada Gaming Control Board (NGCB) has issued a stern warning to Kalshi, a prediction market operator, demanding an immediate halt to its "unlawful conduct" within the state. This action follows a federal judge’s ruling that sided with Nevada, asserting that Kalshi must adhere to state gaming regulations and cannot operate without a proper gaming license. The NGCB is actively opposing Kalshi’s attempts to stay the ruling pending an appeal, signaling a strong stance against the company’s continued operations.
Key Takeaways
- Nevada Gaming Control Board has ordered Kalshi to stop operating in the state.
- A federal judge ruled that Kalshi must comply with Nevada’s gaming regulations.
- Kalshi is appealing the ruling and seeking to continue operations in Nevada.
- The NGCB is also warning Nevada licensees against engaging with prediction market firms.
- Other states, including New Jersey and Ohio, are also taking legal action against Kalshi.
Nevada’s Stance on Prediction Markets
The NGCB has explicitly stated that offering sports event contracts constitutes wagering activity. Consequently, any entity engaging in such practices in Nevada requires a nonrestricted gaming license with specific sports betting approval. The board has previously reached agreements with companies like Robinhood and Crypto.com to prevent them from offering prediction markets in the state. Kalshi, however, has not reached a similar agreement and intends to continue operating while its appeal is processed.
Broader Implications and State Actions
Kalshi and similar firms argue that their operations are distinct from traditional sports betting and fall under the purview of the Commodity Futures Trading Commission (CFTC). However, this interpretation has faced significant opposition from state gaming regulators. The Nevada ruling has emboldened other states, with New Jersey and Ohio initiating legal actions to block Kalshi’s operations within their borders. These moves underscore a growing trend of state regulators pushing back against prediction market platforms they deem to be operating outside of established gaming laws.
Warnings to Licensees
In addition to its direct actions against Kalshi, the NGCB has also issued a warning to its licensees. The board advised casinos against engaging in deals with event contract firms operating in other states. The NGCB emphasized that participating in unlawful sports wagering in another state, or partnering with entities that do, could jeopardize a licensee’s good character and integrity. Licensees are reminded of their obligation to maintain suitability and comply with all applicable laws across all jurisdictions where they operate.
Sources
- Expanse Studios Secures Swedish B2B Gaming License, European Gaming Industry News.
- Nevada Gaming Warns Kalshi To Stop ‘Unlawful Conduct’, Card Player.
