Washington Attorney General Files Lawsuit to Ban Kalshi Over Alleged Illegal Betting

^{Pictured: Nick Brown, Washington State Attorney General}

Washington State Attorney General Nick Brown has filed a lawsuit against prediction markets platform Kalshi, accusing it of violating state gambling laws, according to CoinDesk.

According to the complaint, Kalshi effectively enables users to wager on real-world events — from sports to elections — despite a ban on online gambling under state law.

Prosecutors say the service operates like a sportsbook: users choose outcomes, see odds and receive payouts if their predictions are correct. Kalshi, however, describes its products as “prediction markets” and operates as a U.S.-registered derivatives exchange regulated by the Commodity Futures Trading Commission (CFTC). The lawsuit argues the structure allows the company to bypass state gambling laws.

The filing also alleges that Kalshi’s advertising is misleading and may contribute to gambling addiction.

The attorney general’s office is seeking to block Kalshi’s operations in Washington, require user refunds and impose penalties.

Kalshi rejected the claims, saying it operates lawfully as a federally regulated platform under the jurisdiction of the CFTC rather than individual states.

Gambling Park notes the lawsuit is the latest episode of regulatory pressure on Kalshi in the United States. Earlier, regulators in Nevada secured a temporary ban on certain products, while authorities in Arizona filed criminal charges against the company.