Arkansas Lawmaker Seeks Legal Opinion On Prediction Markets Like Kalshi

An Arkansas legislator says he will seek an opinion from the attorney general on whether it is illegal for prediction markets like Kalshi to operate in the state.

State Sen. Bryan King, R-Green Forest, told Gambling.com on Wednesday he is drafting a letter to Attorney General Tim Griffin for an opinion. Griffin is a former Republican lieutenant governor and U.S. House of Representatives member.

“Just changing the name of what you do is not changing what you’re doing any more than a bank robber changing his name to a bank withdrawal specialist changes what he’s doing,” King said.

Around the country, more than a half dozen states have issued cease-and-desist letters to Kalshi regarding the New York-based company’s  online “community hub for traders.” Kalshi allows people to bet on future events, including sports, political elections and novelty items such what this month’s gas prices will be.

Nationwide, some officials have argued that Kalshi offers users an opportunity to put real money on the outcome of sporting events without the same regulatory and taxation issues facing state-authorized sportsbooks.

In states where sports betting technically is “illegal,” users still can go onto Kalshi and put money on a “yes” or “no” answer to questions about which NFL team will win the Super Bowl and much more. Sports betting is legal in most states but not in the two most-populated states, California and Texas.

Kanshi has taken states to court on the grounds that the company is a financial exchange, not a sportsbook, according to ESPN.

As NewsNation explains it, prediction markets rely on the “wisdom of the crowds” rather than odds set by a bookmaker at a traditional sportsbook.

In Arkansas, sports betting is legal at sportsbooks inside the state’s three casinos and on mobile devices such as cellphones. Each Arkansas casino has its own branded mobile sports-betting app authorized by the state.