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UKNevada Seeks $120K Daily Fines From Kalshi Over Geofencing Dispute
Key Highlights
- Nevada regulators say Kalshi failed to meet an Aug. 12 deadline to properly block restricted event contracts in the state.
- The Gaming Control Board is seeking penalties of $120,000 per day for alleged noncompliance.
- Kalshi says investigators misrepresented information and circumvented restrictions while testing its geofencing system.
The Nevada Gaming Control Board (NGCB) is asking a state court to impose $120,000 in daily penalties on Kalshi over an escalating dispute involving the prediction market platform’s geofencing measures.
Nevada Seeks Daily Penalties
The NGCB claims Kalshi failed to comply with an Aug. 12 deadline requiring it to prevent people in Nevada from accessing sports, election, and entertainment event contracts. Nevada gaming agents were reportedly able to complete restricted trades from within the state after the deadline.
“Kalshi has been under a court order for three months to geofence its operations to comply with Nevada law,” a representative from the NGCB wrote in a statement to the Las Vegas Review Journal on Tuesday. “Most recently, Kalshi agreed to a court order stating that Kalshi had to complete implementation of a geofencing solution from a third-party geofencing provider by August 12, 2026. Kalshi did not meet that deadline, so the Board went to court to enforce Nevada law.”
The deadline stemmed from an agreement reached in July after Nevada regulators previously accused Kalshi of violating a court order restricting those contracts. Kalshi agreed to deploy a third-party, multi-source geofencing system or face the $120,000-per-day penalty.
Kalshi Disputes Nevada’s Findings
Kalshi maintains that it complied with the geofencing requirements and has pushed back on how state investigators tested the platform.
Kalshi’s lawyers, in response to the NGCB’s court order, said investigators violated federal law, misrepresenting their residence and, in at least one case, actively circumventing restrictions that had prevented trading. Kalshi also said some transactions involved an older version of its mobile app that wasn’t subject to the updated geofencing controls.
Rick Heaslip, general counsel and chief regulatory officer for Kalshi, explained that the company hired GeoComply, a state-approved geolocation vendor, and provided regulators with updates throughout the implementation process.
Nevada regulators have rejected Kalshi’s accusations and maintain that the company missed the agreed deadline. The dispute comes as the state continues to monitor its broader gaming industry, which includes a growing market for Nevada online casinos alongside traditional gaming options.
Court Could Decide Compliance Fight
The dispute now centers on whether Kalshi’s geofencing system failed to satisfy the court’s requirements or whether investigators deliberately bypassed restrictions that otherwise functioned as intended.
A court decision on the alleged violations could determine whether the $120,000 daily penalty applies. The fight also continues alongside the larger legal battle between prediction markets and Nevada gaming regulators over the state’s authority to restrict event contracts offered by federally regulated platforms.
