Kalshi Sports Bets to Be Banned in Massachusetts, Court Says (1)

Kalshi Inc. could soon be banned from operating its sports prediction market in Massachusetts, a state court judge said Tuesday, backing a state attorney general challenge to the platform as illegal sports betting.

Judge Christopher K. Barry-Smith granted Massachusetts Attorney General Andrea Campbell’s preliminary injunction request that would stop Kalshi from doing anything “that constitutes sports wagering” under state law, including contracts offered on its prediction market.

The ruling said the state was likely to prove Kalshi required a state gambling license to continue its sports contracts. Barry-Smith, of the Massachusetts Superior Court, scheduled a Friday hearing to work out how and when the ban would go into effect and if it would be stayed during any appeal.

The first state to sue Kalshi for the sports contracts, Massachusetts said the platform was built to “appeal to mass-market speculation” as it “mirrors a digital gambling experience” by offering money-line bets on game outcomes, point-spread wagers as well as over-under bet options.

The decision is the strongest yet rejecting Kalshi’s claim to immunity from state oversight and it could have a major effect on its business as well as prediction markets run by Polymarket and Crypto.com. Kalshi in November warned that an injunction could force the halting or liquidation of $650 million in contracts.

Barry-Smith rejected as “overly broad” Kalshi’s reading of the federal Commodity Futures Trading Commission oversight as preempting state gaming regulators from policing the platform and requiring a license under the Massachusetts sports gambling laws.

While the Commodity Exchange Act does consolidate for the federal agency certain trading oversight, the judge said the “logic does not suggest Congress intended to displace traditional state police powers, such as gambling regulation—particularly in the absence of the express language so stating.”

The injunction would apply on a forward-looking basis, the judge said, requiring no unwinding of existing contracts in a hope to “minimize disruption.” He also brushed aside Kalshi’s complaints that complying with state law would be challenging, harm its users, or put its registration with the CFTC at risk.

“There can be little question that Kalshi well understood that its business model—especially once it began offering bets on sporting events—came into direct conflict” with state enforcement bodies, Barry-Smith said.

Lawyers for Kalshi said in a December hearing that an injunction could be “more than a bump” in the road for the market it runs.

“The minute you start siphoning out liquidity from the system you do real damage to the exchange,” said Grant Mainland of Milbank LLP.

A Law Vegas federal judge decision in November allowed state regulators to take enforcement actions against Kalshi, a ruling that last week was stayed while the Ninth Circuit hears Kalshi’s appeal.

Representatives for the parties weren’t immediately available for comment.

Kalshi is also represented by Foley Hoag LLP.

The case is Commonwealth v. KalshiEX LLC, Mass. Super. Ct., No. 2584CV02525, ruling issued 1/20/26.