Massachusetts court prohibits Kalshi from offering unlicensed sports betting.

A Massachusetts court has prohibited Kalshi, a prediction markets operator, from offering sports betting to state residents through its online platform. The decision was made on Tuesday (January 20) by Judge Christopher Barry-Smith of the Suffolk County Superior Court, after Attorney General Andrea Joy Campbell accused the company of operating without the proper state license.

The judge announced that he will issue a preliminary injunction granting the attorney general's request, preventing the platform from offering financial betting on sports results without obtaining the authorization required by Massachusetts law, according to Reuters.

Barry-Smith based his decision on the understanding that Kalshi's operations conflict with the state's existing sports betting laws. In his ruling, the judge stated: "There is no real question that the licensing, and consequent supervision, of sports betting operations in the state serves both public health and safety, and the financial interests of the Commonwealth."

The case will resume at a hearing scheduled for Friday, when the judge will finalize the preliminary injunction and assess whether to temporarily suspend the order to allow the company to appeal the decision.

The lawsuit against Kalshi was initiated in September 2025 by Attorney General Campbell, a Democrat. The accusation alleges that the company offered sports betting disguised as event contracts, without seeking the necessary authorization from the Massachusetts Gaming Commission.

The New York-based company allows users to profit from predictions about various types of events, including sporting competitions, entertainment, politics, and economics. Kalshi began offering contracts for national sporting events in January 2025, and these products quickly became the largest portion of the platform's trading volume.

The attorney general argued that while licensed operators in Massachusetts are prohibited from offering sports betting to individuals under 21, Kalshi was making a potentially addictive product available to consumers as young as 18, including high school students.

Massachusetts is the first state to obtain an injunction to halt Kalshi's operations within its territory, although the company faces similar lawsuits in other jurisdictions accusing it of violating local gambling laws.

Kalshi has not commented on the court decision, but had previously indicated that it would appeal if an injunction were issued. In its defense, the company argued that state gambling laws do not apply to its sporting event contracts.

The operator claims that the U.S. Commodity Futures Trading Commission (CFTC) has exclusive jurisdiction over its products, classified as exchange-traded “swaps,” a type of derivatives contract. The company also highlighted its status as a registered contract marketplace with the CFTC as part of its argument for operating without a state license.

Judge Barry-Smith, however, considered that the company adopted an “overly broad” view of federal law, stating that Congress never intended to displace traditional state powers to regulate gambling, which can exist in “harmony” with the regulatory authority of the CFTC.

Campbell described the decision as "a major step toward strengthening Massachusetts' gambling laws and mitigating the significant public health consequences that come with unregulated gambling."