Kalshi, a US predictions platform, will no longer be allowed to provide sports event contracts in Massachusetts following a pivotal court decision. The decision has been made due to the similarity to sports betting.
News comes by way of Bookies.com – as Suffolk County Superior Court Judge Christopher Barry Smith issued a first-of-its-kind ruling that allows the Bay State to prohibit sports derivatives trading from unlicensed operators.
The announcement signals an end to this stage of a longstanding feud between Kalshi and Massachusetts; last year, the predictions operator failed in its attempt to unwind a lawsuit against the firm spearheaded by Attorney General Andrea Joy Campbell.
Now, through a preliminary injunction, Massachusetts has been handed a clear pathway to restricting one of the nation's most prominent sports prediction exchanges.
Kalshi must obtain sports betting license to continue Massachusetts operations
As stated by Judge Barry Smith, "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.
"There is no real question that licensure, and the consequent oversight, of sports wagering operations in the state serves both public health and safety, and the Commonwealth's financial interest."
Effectively, this means Kalshi is required to apply for and successfully obtain a sports betting license if it is to provide sports trading contracts in Massachusetts.
According to Barry Smith, fruitless conversations on the matter of licensing and operations had been held:
"At the hearing (in December) 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."
A follow-up hearing to enforce the preliminary injunction against Kalshi – as well as similar predictions operators – will be held on Friday, January 23.
AG Campbell lauded the decision, affirming the importance of abiding by state rules: "The Court has made clear that any company that wants to be in the sports gaming business in Massachusetts must play by our rules – no exceptions.
"Today's victory marks a major step toward fortifying Massachusetts' gambling laws and mitigating the significant public health consequences that come with unregulated gambling."
Should Kalshi seek out and successfully acquire a sports gambling license, the operator would be permitted to reinstate its Massachusetts status.
The kicker is this: such a maneuver is deeply unlikely given the current industry landscape – prediction platforms maintain that CFTC regulation means they do not need to comply with sports betting legislation, and obtaining a license would legitimize state regulator viewpoints.
Further, the inherent differences between sports betting and predictions platforms make state certification fundamentally incompatible with parties on both sides.
Massachusetts Gaming Commission thanks AG for taking action
The Massachusetts Gaming Commission oversees all gambling activities within the State, including consumer protections. In a statement released by Chair Jordan Maynard post-ruling, the 2024-appointed head highlighted the importance of delivering safe gambling to residents:
"The Commission appreciates the efforts of Attorney General Campbell and the Office of the Attorney General to enforce Massachusetts gaming laws and is thankful for the recent ruling – we are hopeful this issue can be settled soon.
"The MGC reminds Massachusetts residents that the safest place to wager, if they choose to do so, is with a legal regulated operator."
Legislators in other states have already begun citing this outcome in their own anti-predictions battles. As posted by gaming legal expert Daniel Wallach on X, the New York Gaming Commission filed the Massachusetts ruling as "supplementary authority" to its case versus Kalshi immediately after the decision was announced.
Kalshi accused of operating illegal sports betting service in Massachusetts
This week's ruling concludes a near-five-month case, in which Kalshi had been accused of offering unlicensed sports gambling markets to Massachusetts residents.
In September 2025, AG Campbell presented a lawsuit against Kalshi to halt its local services, stating:
"Sports wagering comes with significant risk of addiction and financial loss and must be strictly regulated to mitigate public health consequences.
"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."
As has become standard procedure in similar actions during recent months, Kalshi initiated a rebuttal of its own by attempting to hold the case in a federal court.
The platform maintained that as it is regulated federally by the CFTC as a derivatives firm, it is not beholden to state statutes.
However, a federal judge determined that this case was to be settled in Massachusetts.
Thus, Kalshi stood before a Massachusetts courtroom and attempted to explain why sports trading differs from traditional – and highly regulated – sports betting.
Also of note is that Kalshi does not pay licensing fees or make tax contributions.
AG Campbell's lawsuit brands Kalshi as a "sports wagering operator" throughout the 43-page lawsuit, and refers to social media posts by Kalshi accounts where it is marketed as a sports betting platform.
In summary, the predictions group was accused of:
- Accepting sports "wagers" without a Massachusetts Gaming Commission license.
- Falsely marketing a sports betting service as an event contracts product.
- Engaging in misleading online advertising.
Kalshi also recently expanded its sports offerings beyond 'yes' or 'no' outcomes by publishing player props and parlays – both stalwart markets in the sports betting scene.
These factors culminated in Judge Barry Smith's resolution to green-light a preliminary injunction against Kalshi.
New wave of anti-predictions lawsuits on the way?
The success of this anti-predictions lawsuit could inspire a new template for similar legal action among other state authorities.
Until now, regulators have predominantly issued cease-and-desists to predictions platforms offering sports wagering-style markets.
These letters are often rebuked by prediction operators – who attest that sports trading markets are not sports betting and, in turn, not eligible for state regulation. The CFTC is heralded by trading operators as the sole arbiter of justice.
But when Kalshi's attempt to bring this case to federal courts failed, it became clear that these claims were refutable at not just the state level, but that there exists some level of uncertainty at the federal tier, too.
Attention now turns to Nevada, where Polymarket faces its first-ever lawsuit for supporting mobile sports contracts akin to gambling, and New York, where Kalshi and the state are currently jousting via conflicting legal action.
If these cases also favor regulators, state officials may replace cease-and-desists with actionable litigation.
