The wins keep on pouring in for prediction market operator Kalshi. This time, a federal judge in New Jersey granted the operator an injunction against the state. The injunction stops the state from restricting Kalshi from offering sports event contracts in the Garden State.
New Jersey had sought to end Kalshi's sports event contract offerings in its jurisdiction by serving a cease-and-desist letter, as the state felt Kalshi was offering "unauthorized sports wagering". The company responded to the letter by suing the state's gaming enforcement division in federal court.
On April 28, US District Judge Edward Kiel ruled that Kalshi fell within the Commodity Futures Trading Commission's (CFTC) jurisdiction and not that of the state's gaming enforcement division. A familiar win for Kalshi.
Kalshi Wins In New Jersey As They Did In Nevada
For those following the developing situation between Kalshi and a group of seven states - Illinois, Maryland, Montana, Michigan, Nevada, New Jersey, and Ohio - this ruling by Judge Kiel isn't new.
It was Nevada Circuit Court Judge Andrew Gordon who first provided the favorable ruling for the prediction market company, stating, "Because the CFTC has approved (or at least not yet disapproved) Kalshi’s sports-related contracts, the defendants cannot pursue civil or criminal liability against Kalshi."
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Both the New Jersey and Nevada rulings leave it up to the CFTC to decide whether Kalshi, Crypto.com, and Robinhood, which also offer sports event contracts, are, in fact, forms of unauthorized sports gambling.
What Is Next For Kalshi
So far, Kalshi has only sought legal action against the two aforementioned states and Maryland. Judge Adam Abelson has scheduled an injunction hearing in Kalshi vs the state of Maryland for May 29. Based on the two positive rulings for the prediction market site, there is no reason to suggest they won't win a third case.
JUST IN: U.S. District Judge Adam Abelson has scheduled a hearing on Kalshi’s motion for preliminary injunction against the State of Maryland for Thursday, May 29th, at 10:00 AM EST in Courtroom 7D of the Baltimore courthouse. pic.twitter.com/h9c4C1iTvc
— Daniel Wallach (@WALLACHLEGAL) April 24, 2025
Though Maryland's Lottery and Gaming Control Agency Director John Martin, believes they've got a case stating: "This activity puts our citizens at risk by ignoring the carefully crafted statutory and regulatory safeguards developed in each of our states, and jeopardizes the critical tax revenue derived from sports wagering across the 40 jurisdictions where it is authorized," That same argument has been used unsuccessfully in both Nevada and New Jersey. It is unlikely to work in Maryland.
Kalshi is not the only prediction market that has reacted in Maryland. Crypto.com has also followed in Kalshi's footsteps by suing the state.
The CFTC has been silent on prediction markets, even canceling a planned roundtable discussion about regulating the booming industry. For the time being, Kalshi and other prediction markets can operate in peace.
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