New York is suing prediction market Kalshi, calling it an illegal gambling operation

New York Attorney General Letitia James has sued prediction market Kalshi, accusing it of operating an unlicensed illegal gambling platform.

The state says Kalshi violated gambling laws by offering bets on sports, elections, culture, and other events, and by allowing some users under 21 to bet.

Kalshi denies the allegations, saying it is federally regulated and warning a shutdown would push users to offshore markets.

New York is seeking forfeiture of profits, restitution, and treble damages totaling about $36 billion.

The case could determine whether prediction markets are treated as gambling under state law and shape regulation nationwide.