Washington Judge Orders Kalshi to Halt Sports, Election Contracts
A King County Superior Court judge has ordered Kalshi to stop offering sports, election, and several other event-contract markets to Washington residents by September 2, siding with state attorney general Nick Brown in a lawsuit that accused the prediction market operator of running an illegal gambling business.
Judge John McHale's order, issued Wednesday, requires Kalshi to block Washington users from wagering on sports, elections, politics, entertainment, culture, technology, science, and so-called "mention" contracts, which pay out based on whether a public figure says specific words.
Kalshi can keep offering Washington residents contracts tied to commodities, climate, and economic or financial indicators, and users can still close out existing positions in the restricted categories.
Geofencing Deadlines And Daily Fines
The order sets a two-stage rollout: Kalshi must have a preliminary IP address and residency-based geofence in place by August 19, followed by a more robust, multi-source geofencing system by September 2.
Missing the September 2 deadline exposes Kalshi to fines of $120,000 a day, though the company can submit an affidavit explaining any delay for McHale to weigh before setting a final penalty. That figure matches the daily fine Nevada regulators are separately pursuing against Kalshi in a June contempt motion over an earlier injunction there.
McHale also barred Kalshi from advertising the restricted wagers to Washington consumers, and wrote that the company had "willfully ignored" a December notice from the Washington State Gambling Commission stating that its event-based contracts were not authorized in the state.
Kalshi Says It Will Appeal
Kalshi asked the Washington Court of Appeals to pause McHale's injunction while it challenges the ruling, but the request was denied at both the trial court and appellate levels. A company spokesperson said Kalshi is federally regulated by the Commodity Futures Trading Commission, which it argues has exclusive jurisdiction over its exchange, and is "considering all legal options."
Washington becomes the third state with active court-ordered restrictions on Kalshi, after Michigan and Nevada; a federal judge in Utah reached a similar conclusion, ordering that Utah can enforce its own gambling ban against the platform.
"Kalshi has gotten rich promoting wagers on sports, elections, natural disasters, events related to the Iran War, and more," Brown said in a statement. "Under this order, Kalshi is banned from offering wagers on most of those topics in Washington. As this case moves forward, we will continue to enforce Washington law and hold Kalshi accountable for misleading consumers."
What This Means For US Prediction Markets
The Washington case adds to a patchwork of state-level challenges facing Kalshi and rival platforms such as Polymarket, even as the federal Commodity Futures Trading Commission has told Kalshi it can continue operating nationally. For bettors in states where prediction markets are restricted, regulated, licensed sportsbooks remain the compliant way to wager on sports and other events.
Washington's underlying lawsuit continues, with the attorney general's office also seeking to recover money Washington bettors have lost on Kalshi and to assess civil penalties.
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