Nevada District Court Judge Jason Woodbury issued a 14-day temporary restraining order (TRO) against Kalshi on Friday, effectively halting its operations in the state.The Nevada Gaming Control Board (NGCB) argues that Kalshi is facilitating unlicensed gambling, particularly through contracts related to sports, elections, and entertainment.The regulatory blow comes just as Kalshi reportedly reached a $22 billion valuation following a fresh $1 billion funding round led by Coatue Management.A formal hearing to determine the future of the platform’s legality in Nevada is scheduled for April 3, 2026.
The legal landscape for prediction markets in the United States grew increasingly complex this week as Nevada became the first state to successfully force Kalshi to suspend its operations. Carson City District Court Judge Jason Woodbury granted the Nevada Gaming Control Board a temporary restraining order on Friday, prohibiting the platform from offering event contracts to Nevada residents for at least the next two weeks.The regulatory action centers on the classification of event contracts. While Kalshi maintains that it is a CFTC-regulated exchange offering financial derivatives, Nevada authorities contend that the platform’s offerings—specifically those tied to sports and political outcomes—constitute unlicensed gambling. The NGCB’s move follows a similar injunction in Massachusetts and recent criminal charges filed against Kalshi in Arizona, signaling a coordinated push by state-level gaming regulators to reclaim jurisdiction over the rapidly growing sector.The timing of the ban is notable, as it coincides with a period of massive capital inflow for the company. Reports surfaced on March 19 that Kalshi secured $1 billion in new funding, doubling its valuation to $22 billion in under four months. This valuation now places the startup ahead of traditional betting giants like FanDuel and DraftKings, highlighting the high stakes of the ongoing jurisdictional battle between federal and state regulators.
“Prediction markets, to the extent they facilitate unlicensed gambling, are illegal in Nevada, and we have a statutory duty to protect the public,” said Mike Dreitzer, Chairman of the Nevada Gaming Control Board, in a statement regarding the lawsuit. The board argued that the platform lacks the consumer protections and age-verification rigor required of licensed sportsbooks in the state.
Kalshi has previously argued that the Commodity Exchange Act grants the CFTC exclusive oversight of its markets, shielding it from state-by-state gaming laws. However, Judge Woodbury’s ruling suggested the board has a “reasonable likelihood of success” in its claim that these markets bypass the state’s regulatory framework. The industry now looks toward the April 3 hearing, which will decide if the temporary ban will transition into a permanent preliminary injunction.
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