Kalshi and Rhode Island Sue Each Other in Latest Challenge to Prediction Markets

Rhode Island sued Kalshi and Polymarket over sports-related event contracts, saying they amount to illegal gambling under state law.

Kalshi sued Rhode Island in response, arguing its products are federally regulated event contracts under CFTC oversight.

The clash centers on whether prediction markets can offer sports-linked contracts in states that restrict sports betting.

The outcome could set a major precedent for how federal and state authorities regulate prediction markets and similar products.