Massachusetts Judge Moves to Halt Kalshi’s Sports Prediction Market

A Massachusetts judge is preparing to issue a preliminary injunction that would force prediction market platform Kalshi to halt its online sports-related contracts in the state, marking a significant legal challenge for the company’s sports business. The ruling signals growing regulatory scrutiny over whether prediction markets offering sports contracts comply with state sports-betting laws.

On Tuesday, Superior Court Justice Christopher Barry-Smith ruled that Kalshi is likely operating in violation of Massachusetts law by offering sports-related event contracts without holding the required license under the state’s Sports Wagering Law. The judge agreed with arguments made by state authorities that Kalshi’s binary-style sports contracts may fall within the legal definition of sports betting, which is strictly regulated in Massachusetts.

The court outlined a timeline for the injunction to take effect. State regulators were instructed to submit a proposed injunction by Wednesday that avoids disrupting existing contracts already held by users. Kalshi will then have until Friday to respond to the state’s proposal. Barring any delays or approved stays, the judge indicated he intends to order a halt to Kalshi’s sports prediction contracts in Massachusetts by the end of the week.

The legal dispute stems from a lawsuit filed in September by the Massachusetts attorney general, who alleged that Kalshi’s sports prediction products violate state sports-betting statutes. While Kalshi has argued that its contracts are federally regulated event contracts rather than traditional sports wagers, the court appeared unconvinced at this stage of the proceedings.

In his written ruling, Justice Barry-Smith emphasized that “requiring Kalshi to be licensed to offer its sports-related event contracts in Massachusetts serves the public interest,” reinforcing the state’s position that consumer protection and regulatory oversight are paramount in the sports wagering market.

Kalshi did not immediately respond to requests for comment following the ruling. The case is being closely watched by the prediction market and crypto-adjacent industries, as it could set an important precedent for how sports prediction markets are treated under state gambling laws. If the injunction is finalized, it may also influence how other states approach similar platforms, potentially reshaping the regulatory landscape for online prediction markets tied to sports outcomes.