Fresh off a $1-billion Series E funding raise, the prediction market Kalshi is setting up a lobbying presence in Washington, DC in an effort to stave off increasing regulatory pressure. The company, which has a valuation of $11 billion, offers users the opportunity to wager money on the outcomes of various yes-or-no questions—from gas prices in Texas, to geopolitical events like Federal Reserve interest rate cuts, to when Iran’s Supreme Leader, Ali Khamenei, will be ousted from power. Kalshi’s entrance into the legal sports betting industry, a market worth an estimated $18 billion, hasn’t been received warmly by gaming commissions across the country. The company is currently in litigation in Massachusetts, Georgia, Kentucky, Illinois, Ohio, South Carolina, Nevada, New York, and New Jersey. “Various gaming commissions are telling them, ‘What you’re doing is illegal gambling, or is considered gambling or betting. You don’t have a license to do this. Get out of our state,’” explains Andrew Kim, an attorney at Goodwin specializing in the gaming and gambling sectors. The regulatory question hovering over prediction markets, including Kalshi and the offshore-based Polymarket, will be increasingly significant in the coming weeks, months, and potentially years, says Kim. The argument that the markets are governed by the Commodity Exchange Act is under increasing scrutiny. “When you’ve got that many cases brewing,” Kim says, “you can’t help but think that this is heading to the Supreme Court.”
Read the Inc.com article for more.