A Nevada court has moved to halt Kalshi’s activities in the state, marking another escalation in the ongoing legal battle over prediction markets and gambling laws.

Carson City District Court Judge Jason Woodbury issued a 14-day temporary restraining order, siding with the Nevada Gaming Control Board. The ruling blocks Kalshi from offering event-based contracts tied to sports, elections, and entertainment while the case moves forward.

At this early stage, the court found that state regulators are likely to succeed in arguing that Kalshi’s products fall under Nevada’s gambling framework. In practical terms, that puts the company in the same category as licensed betting operators without holding the required state approval.

The regulator has taken a firm stance.

Nevada Gaming Control Board Chair Mike Dreitzer said prediction markets cross into illegal territory when they resemble unlicensed wagering, adding that the agency is obligated to enforce state law and protect consumers.

"Prediction markets, to ​the extent they facilitate unlicensed gambling, are illegal in Nevada, and we have a statutory duty to protect the public,"

Dispute centers on gambling law vs federal oversight

At the core of the case is a familiar question for the industry: who has authority over prediction markets. Kalshi maintains that its contracts fall under the jurisdiction of the Commodity Futures Trading Commission, positioning them as financial instruments rather than bets. The company has relied on this argument in multiple legal challenges across the United States.

Nevada regulators see it differently.

In the court filing, they argued that contracts tied to real-world outcomes particularly sports fit the state’s definition of a “sports pool,” which requires a local license to operate. Judge Woodbury acknowledged that the issue of federal preemption is still evolving.

For now, he indicated that existing legal precedent does not support Kalshi’s position strongly enough to override state authority.

Nevada is not acting in isolation. Kalshi is currently facing legal challenges in several jurisdictions, reflecting broader uncertainty around how prediction markets should be classified and regulated.

Earlier this year, a Massachusetts court briefly restricted the company’s sports-related contracts before that decision was lifted on appeal. More recently, Arizona escalated the situation further by filing criminal charges. Attorney General Kris Mayes accused the company of operating an illegal gambling business, a claim Kalshi CEO Tarek Mansour rejected, calling the move excessive.

"Kalshi may brand itself as a 'prediction market,' but what it's actually doing is running an illegal gambling operation and taking bets on Arizona elections, both of which violate Arizona law," said Attorney General Mayes. 

Back in Nevada, the court has scheduled a hearing on April 3 to decide whether the temporary block should be extended into a longer-term injunction.

For now, the decision leaves Kalshi sidelined in one of the strictest gambling jurisdictions in the U.S., while the broader legal framework around prediction markets continues to take shape in real time.

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