Kalshi Must Halt Trading Sports-Event Contracts In Massachusetts, Judge Rules

Jan 20th, 2026 12:32 PM EST

A Massachusetts judge on Tuesday issued a first-in-the-nation order that allows the Commonwealth to prohibit the prediction market Kalshi from offering sports-event contracts within the state.

The ruling, by Judge Christopher Barry-Smith, comes in the wake of a hearing in December, and Kalshi's unsuccessful effort to remand the case to a federal court.

"The Commonwealth is entitled to a preliminary injunction prohibiting Kalshi from offering sport-related event contracts in the absence of the required license under the Sports Wagering Law," Judge Barry-Smith wrote.

"At the hearing both parties discussed, but did not resolve, certain details of the Commonwealth's requested injunction, including how to prohibit new contracts without impacting already existing contracts," the judge added.

Th Commonwealth has until Wednesday to submit its proposed preliminary injunction. The next hearing in the case would take place on Friday, after which the judge will enter the injunction.

Bookies.com has reached out to the Massachusetts Attorney General, the Massachusetts Gaming Commission and officials from Kalshi for comment.

Sports-related contracts have fueled the stratospheric rise in prediction markets such as Robinhood, Polymarket and Kalshi. They make up as much as 90% of the trading volume on Kalshi at times. Boston-based DraftKings, FanDuel, and Fanatics launched prediction-market platforms last year. They, however, do not offer sports-related trades in Massachusetts (or any other state) where they operate a licensed online sports book.

Mass AG Filed Lawsuit In 2025

Attorney General Andrea Campbell sued Kalshi last year. A federal judge sided with Campbell last fall in ruling that the lawsuit against Kalshi must be decided in state, and not federal, court.

The lawsuit seeks to block Kalshi from accepting sports-related trades in the Commonwealth. Kalshi sought to move the case to federal court but was unsuccessful.

The 43-page suit filed by Campbell in September claims Kalshi operates in the same manner as a sports betting site. Kalshi is neither licensed, regulated, nor taxed by the state. Sports betting is regulated and managed by the Massachusetts Gaming Commission.

The broader challenge to determine the difference - if any - between a “trading market” and “sportsbook” remains contested in several jurisdictions. The Commodities Futures Trading Corporation (CFTC) holds jurisdiction over prediction markets. That frees them from state oversight and taxation. Sportsbooks, meanwhile, remain subject to state-by-state regulations and tax obligations.

Kalshi Entangled In Legal Action In Multiple States

Kalshi has received cease-and-desist orders from Arizona, Illinois, Montana, and Ohio. It has ongoing litigation against New Jersey in the U.S. Court of Appeals for the Third Circuit. And it remains entangled in litigation with regulators in Maryland and Nevada.

"Kalshi offers its users a fair, transparent, federally-regulated, and nationwide marketplace. Rather than engage in dialogue with Kalshi as many other states have done, Massachusetts is trying to block Kalshi’s innovations by relying on outdated laws and ideas," a Kalshi spokesperson told bookies.com when the suit was filed.

"Prediction markets are a critical innovation of the 21st century, and all Americans should be able to access them. We are proud to be the company that has pioneered this technology and stand ready to defend it once again in a court of law."

AG: Kalshi Must Obtain A License And Follow Our Laws

“Sports wagering comes with significant risk of addiction and financial loss and must be strictly regulated to mitigate public health consequences,” Campbell said in a statement when the suit was filed. “This lawsuit will ensure that if Kalshi wants to be in the sports gaming business in Massachusetts, they must obtain a license and follow our laws."

Kalshi offers "sports wagering" through an “exchange" and via "event contracts," the Massachusetts lawsuit alleges. The filing in in Suffolk County Superior Court uses the term “sports wagering” throughout. And cites examples of Kalshi touting itself as a "sports betting" site on social media.

The sports trading contracts on Kalshi usually offer a “yes” or “no” market on the outcome of an event. Kalshi's offerings have expanded to prop wagers and parlay offerings.

Sports-betting-related terms have appeared in Kalshi's advertising and social-media posts since it launched in the U.S.

Kalshi 'Engaged In Sports Betting,' Suit Says

Kalshi neither applied for nor received a Massachusetts sports wagering licenses, as required by law, the suit alleges.

The suit claims Kalshi engages “in the business of accepting wagers” and does so without a license issued by the Massachusetts Gaming Commission.

The AG seeks monetary relief and to prohibit Kalshi from “engaging in sports wagering without a license.”

The suit claims sports-based trading markets operate as regulated sportsbooks.

“Despite Kalshi calling its products ‘event contracts,’ consumers are placing wagers on the outcome of sporting events,” the suit alleges.

MGC Meeting Early Sign Lawsuit Was In Works

The members of the AG’s office met with the Massachusetts Gaming Commission in an executive session in September before filing the suit. A meeting such as that often precedes legal action taken in the gaming space.

“Prediction market companies are expanding into sports wagering while neglecting age restrictions, player protection programs, state taxes, and other consumer protections. (We) appreciate the Attorney General’s efforts to enforce the law and hold these companies accountable to Massachusetts’ rigorous standards,” said Massachusetts Gaming Commission Chair Jordan Maynard in a statement in September. “We look forward to our continued partnership with Attorney General Campbell and her office.”