Connecticut has asked a court to block Kalshi from offering what it says are unlicensed sports wagers in the state, escalating a fight over whether the prediction-market platform’s contracts are regulated financial products or gambling. The lawsuit says Kalshi’s “event contract” products are yes-no bets on future outcomes, and that its sports markets closely resemble wagers on whether a team or player will win, the number of wins in a season, league rankings, points scored, point spreads and player statistics.
The attorney general’s office says the state already ordered Kalshi and two other sites in December 2025 to stop advertising, offering or promoting sports event contracts or any other form of unlicensed online gambling to Connecticut residents, and to let customers withdraw funds. Kalshi then sued state officials for a preliminary injunction, arguing that its prediction contracts are swaps overseen only by the Commodity Futures Trading Commission and that Connecticut’s gambling laws should not apply.
As covered in August, a federal judge in Connecticut denied Kalshi’s bid for a preliminary injunction, and the company has appealed to the Second Circuit. The state now wants its own injunction, saying the products at issue are sports wagers rather than protected derivatives. Attorney General William Tong said sports event contracts are no different than sports betting and are not shielded by federal law from Connecticut’s consumer protection laws.
Governor Ned Lamont said the point of legalizing sports wagering in 2021 was to create a safe, responsibly regulated market, not what he called a free-for-all on sports betting. The broader dispute has become part of a larger state-level push against Kalshi’s sports-event-contract business. The Block reported that Connecticut is among more than a dozen states that have taken enforcement action or filed suits over the company’s products.
