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UKKalshi Ordered to Stop Most Betting Operations in Washington
Key Highlights
- A King County judge ordered Kalshi to stop offering many types of event wagers in Washington.
- The court found Kalshi violated Washington’s Gambling Act and Consumer Protection Act.
- Kalshi must use geofencing to prevent Washington residents from accessing prohibited markets.
Kalshi is still available in Washington State, but its betting markets have been heavily restricted following a ruling from a King County Superior Court judge.
Court Orders Kalshi To Halt Betting
Judge John McHale issued the order for Kalshi to cease the majority of its betting activity in Washington on August 13, ruling that the prediction market operator violated state gambling and consumer protection laws. As a result, Kalshi is now prohibited from offering, accepting, or facilitating wagers in Washington involving sports, elections, politics, entertainment, culture, technology and science, and certain other event-based markets.
Kalshi must also implement IP address and residency-based geofencing by August 19 to prevent prohibited wagering. The operator is also required to enforce a more comprehensive geofencing solution by September 2 and will face a $120,000-a-day penalty for non-compliance. Kalshi previously had to geofence contracts in Nevada related to sports, politics, and entertainment.
“Kalshi has gotten rich promoting wagers on sports, elections, natural disasters, events related to the Iran War, and more. Under this order, Kalshi is banned from offering wagers on most of those topics in Washington,” said Attorney General Nick Brown. “As this case moves forward, we will continue to enforce Washington law and hold Kalshi accountable for misleading consumers.”
Washington Treats Kalshi Markets As Gambling
Washington law defines gambling as risking something of value on a contest of chance or a future contingent event in exchange for the possibility of a payout. Judge McHale determined Kalshi’s markets fit that definition because users risk money on uncertain outcomes and can receive money when their predictions are correct.
Kalshi has marketed itself as a prediction market rather than a traditional gambling operator. However, the court concluded that distinction doesn’t exempt the company’s activities from Washington gambling laws.
Advertising & Mention Bets Face Restrictions
Kalshi is also prohibited from advertising the wagers covered by the injunction to Washington consumers. The court found that marketing illegal gambling activities constituted unfair or deceptive practices under the state’s Consumer Protection Act.
The case, which began when Washington issued a preliminary injunction against Kalshi in July, highlighted an advertisement in which someone discussed finding a way to bet on the NFL while living in Washington.
The order also covers “mention” markets, where customers wager on whether a public figure will say particular words. State officials argued those wagers can create additional risks because people close to the subject could potentially influence the outcome.
