The Trump administration is trying to stop Utah from enforcing its gambling ban against Kalshi, making Utah the tenth state sued by the US government agency that regulates prediction markets.
Utah, which prohibits gambling, sued Kalshi in a state court last week. Utah’s lawsuit seeks an order prohibiting Kalshi from offering bets on sports, elections, politics, and other events.
“Kalshi runs an online casino in Utah and calls it a prediction market. That violates Utah law,” Utah Attorney General Derek Brown, a Republican, said last week. “Not only do our state laws ban gambling but Utah is one of only two states where gambling is also prohibited under the state constitution. For 130 years, Utah has been clear: gambling has no place here, and we will enforce our laws.”
Utah already defeated Kalshi in federal court after the prediction market filed a preemptive lawsuit that sought to prevent the state from enforcing its gambling laws. Now that Utah is moving ahead in its attempt to shut down Kalshi, it must defend against a lawsuit filed by the US Commodity Futures Trading Commission (CFTC).
The CFTC “has filed a lawsuit against Utah to block the state’s efforts to shut down CFTC-registered contract markets using state laws,” the commission said yesterday . “The lawsuit follows Utah’s decision to file civil enforcement actions in state court against CFTC-regulated markets and other businesses. Utah’s effort to restrict the functioning of CFTC-registered exchanges obstructs Congress’s decision to federally preempt state law.”
If Utah can shut down Kalshi, that could spell trouble for Kalshi’s chief prediction-market rival, Polymarket, and for sports betting sites like DraftKings and FanDuel. DraftKings and FanDuel advertise availability in all US states via a mix of products , including prediction-market platforms in states like Utah. Both are registered with the CFTC.
