Kalshi has filed a lawsuit against New York state regulators. The company says New York is trying to control how its prediction markets work. Kalshi argues this is illegal because only the U.S. federal government has the power to regulate its exchange.
Kalshi runs a market where people trade on events, like sports or economic outcomes. This type of trading is known as a “prediction market.” Kalshi says these tools help people and businesses manage risk, just like other financial markets.
News: Kalshi files federal lawsuit against New York State after receiving cease-and-desist letter from @NYSGamingComm on Friday evening and will soon be filing a motion for preliminary injunction to prevent NYS from from enforcing its gambling laws vs. Kalshi. (h/t @akhoya87) pic.twitter.com/GfONveCQx4
— Daniel Wallach (@WALLACHLEGAL) October 27, 2025
Kalshi Says Federal Law Comes First
In this case, Kalshi points to federal rules. Since 1936, futures markets have been regulated by federal law. And in 1974, the U.S. created the Commodity Futures Trading Commission, or CFTC, to oversee trading. The law clearly gives the CFTC exclusive control over these markets.
Kalshi is already approved by the CFTC. So, the company says New York cannot force different rules on it. Doing so would create a “patchwork” of state laws. The lawsuit says this would cause confusion and hurt the market.
Federal courts in Nevada and New Jersey recently agreed with Kalshi in similar cases. Those rulings stopped state regulators from interfering.
KALSHI SURPASSES $4 BILLION IN OCTOBER TRADING VOLUME, NEW ALL TIME HIGH
— *Walter Bloomberg (@DeItaone) October 29, 2025
Why This Matters
Kalshi says New York’s threat to fine or punish the company puts it at risk. If Kalshi blocks New York users, it could damage the business. If it does not, the state may try to take legal action. The company argues this could harm customers and weaken trust.
The lawsuit also warns that technology needed to block users by state may not work well at scale.
What Comes Next
This case will help decide who controls prediction markets in the U.S; states or the federal government. If Kalshi wins, it could strengthen federal oversight and expand prediction-market use. If New York wins, states may gain more power to regulate trading platforms.
Disclaimer
The information provided by Altcoin Buzz is not financial advice. It is intended solely for educational, entertainment, and informational purposes. Any opinions or strategies shared are those of the writer/reviewers, and their risk tolerance may differ from yours. We are not liable for any losses you may incur from investments related to the information given. Bitcoin and other cryptocurrencies are high-risk assets; therefore, conduct thorough due diligence. Copyright Altcoin Buzz Pte Ltd.
The post Kalshi Sues New York Regulator Overreach appeared first on Altcoin Buzz.
