<\/p>\n
Arizona Attorney General Kris Mayes announced that her office filed gambling and related criminal charges against the companies behind prediction markets platform Kalshi.<\/p>\n
In a Tuesday notice, Mayes said<\/a> that the charges alleged that Kalshi operated an \u201cillegal gambling business in Arizona without a license\u201d and offered election wagering, in violation of state laws. Arizona authorities alleged that Kalshi\u2019s prediction markets platform allowed state residents to bet on event contracts related to sports and state and federal elections.\u00a0<\/p>\n \u201cKalshi may brand itself as a \u2018prediction market,\u2019 but what it’s actually doing is running an illegal gambling operation and taking bets on Arizona elections, both of which violate Arizona law,\u201d said Mayes. \u201cNo company gets to decide for itself which laws to follow.\u201d<\/p>\n According to the AG\u2019s office, the charges followed Kalshi filing its own lawsuit against several US states \u201cpreemptively in an attempt to avoid accountability under Arizona law.\u201d State authorities have filed similar lawsuits<\/a> against the companies of prediction market platforms like Polymarket and Kalshi.<\/p>\n Related: <\/strong><\/em>Kalshi suffers court loss in Ohio over sports betting lawsuit<\/strong><\/em><\/a><\/p>\n \u201cSadly, a state can file criminal charges on paper-thin arguments,\u201d a Kalshi spokesperson told Cointelegraph. \u201cStates like Arizona want to individually regulate a nationwide financial exchange, and are trying every trick in the book to do it. As other courts have recognized and the CFTC affirms, Kalshi is subject to federal jurisdiction. It’s different from what sportsbooks and casinos offer their customers, and it should not be overseen by a patchwork of inconsistent state laws.\u201d<\/p>\n Last week, an Ohio judge denied Kalshi\u2019s request for a preliminary injunction in a similar case against state authorities, saying that the company had failed to show that the sports event contracts available on the platform were subject to the \u201cexclusive jurisdiction\u201d of the Commodity Futures Trading Commission (CFTC). However, in February, a federal judge in Tennessee blocked state authorities<\/a> from enforcing gambling laws against Kalshi.<\/p>\n Now the sole commissioner on the CFTC since acting chair Caroline Pham stepped down in December, Chair Michael Selig has publicly said that the federal regulator<\/a> would defend prediction market platforms from state-level lawsuits.<\/p>\nCFTC chair backs \u201cexclusive authority\u201d over prediction markets<\/h2>\n