- ▸ Judge extends Kalshi ban and signals a preliminary injunction, tightening the state’s grip on prediction markets.
- ▸ Kalshi’s path now likely runs through appeals, with limited short-term routes back into Nevada.
- ▸ CFTC/DOJ lawsuits and multi-state actions are pushing the fight toward a potential Supreme Court showdown.
Kalshi’s event contracts will remain off limits in Nevada for at least the next 14 days after a judge extended a temporary restraining order blocking the platform from operating in the state. The court is now set to consider whether to escalate that ban into a preliminary injunction, as the broader legal fight over state versus federal authority continues.
The Nevada ruling comes as Kalshi also faces separate criminal charges in Arizona, where the presiding judge underscoring the growing, multi-state pressure on prediction markets.
Nevada gaming regulators get another win
A hearing in the Carson City District Court on Friday resulted in a disappointing development for Kalshi and other prediction market operators. For the Nevada Gaming Control Board (NGCB), though, the session couldn’t have gone much better.
According to Nate Raymond of Reuters, Judge Jason Woodbury heard oral arguments and then announced that he is extending the current temporary restraining order (TRO) against Kalshi offering prediction markets on sports, elections and entertainment to customers in Nevada through April 17. Before that order expires, though, Woodbury intends to replace it with a preliminary injunction that will be in place as long as it takes for the court to decide the case on the merits.
The judge also gave Kalshi until May 4 to put geofencing or geolocation controls in place to block Nevada-based users from accessing contracts deemed illegal by the court, according to reporting from Richard Velotta of the Las Vegas Review-Journal.
“The judge said if Kalshi can’t meet the May 4 deadline it may request an extension, but he’s requiring that the company fully explain why,” writes Velotta. Woodbury is also requiring any request for an extension to detail how much of the geolocation or geofencing has been implemented, outline progress on any remaining work, identify outstanding tasks, and provide an estimated timeline for completion.
The temporary restraining order went into effect on March 20, after the NGCB petitioned the court to take action against Kalshi. The NGCB argued that Kalshi’s prediction markets are tantamount to offering online gambling in the state without a license.
At that time and during Friday’s hearing, counsel for Kalshi retorted that its prediction markets are “swaps” that are regulated by federal law. However, Woodbury has held that the contracts are indistinguishable from online gambling and Nevada law bars the operation of such activity without a license from the NGCB.
While Nevada law does not allow for entities to appeal temporary restraining orders, that protection is not afforded to preliminary injunctions. That means the next move(s) from Kalshi will likely await Woodbury’s next order.
Kalshi’s path forward in Nevada gets even narrower
At this juncture, Kalshi’s options to reestablish its business on legal footing in Nevada focus on another court in Carson City, the Nevada Supreme Court. A successful appeal of Woodbury’s injunction is the easiest and quickest path back into Nevada for Kalshi.
Failing that, Kalshi could hope to win the case against the NGCB in the district court outright. If that effort fails, it could appeal the trial court’s decision to the Nevada Supreme Court as well.
This litigation began in March 2025, when the NGCB issued a cease-and-desist order to Kalshi. Kalshi responded by suing in federal court but ultimately had a short-lived restraining order voided.
In response, the NGCB filed its motion in state court and has asked the court to affirmatively declare that prediction markets violate Nevada law. After the Ninth Circuit Court of Appeals denied a request for a stay from Kalshi, Woodbury issued his first TRO.
Kalshi’s options are narrowing in terms of its Nevada operations, but help may come from elsewhere as the federal government attempts to intervene.
CFTC, DOJ get involved in dispute between prediction markets and state governments
On April 2, the United States Commodity Futures Trading Commission (CFTC) and the US Department of Justice filed lawsuits against agencies and officials in Arizona, Connecticut, and Illinois. The intent of these complaints in federal courts is to block state governments’ attempts to enforce their laws against CFTC-regulated prediction exchanges.
Although there has been no indication of expansion, the CFTC and/or the DOJ could technically do the same regarding Nevada. The CFTC has been active in the geographical region, filing an amicus brief supporting Kalshi at the Ninth when Kalshi requested a stay from that court.
However, there is a significant difference between disputes over state sovereignty in regard to prediction markets in Arizona, Connecticut, and Illinois and the same in Nevada. Nevada’s status quo has more of a “toothpaste is already out of the tube” effect.
Because federal courts have already issued rulings regarding the situation in Nevada, raising some of the same issues hoping for a different outcome would likely be a waste of resources, even if the party initiating the action is the CFTC or the DOJ instead of Kalshi. Otherwise, Nevada would have probably been a fourth target for those agencies’ complaints.
While federal district Judge Michael Liburdi did little to telegraph on Friday which way he is leaning in terms of Kalshi’s interests in neighboring Arizona, the CFTC/DOJ lawsuits could counteract that ruling either way. Nevada is now perhaps the “ground zero” for whether state governments can dictate the terms of prediction markets within their borders.
Can Nevada be a blueprint for other states?
Other states besides those already mentioned are attempting to curtail prediction market activity, including Maryland and Washington. If Kalshi exhausts all its legal options without affecting a change to the status quo in Nevada, it might result in more states looking to replicate that result.
Gaming lawyer Daniel Wallach commented on LinkedIn following the ruling: “Big win for Nevada, which now joins Massachusetts as the first two states to secure a preliminary injunction vs. Kalshi. More likely to follow as states begin using state court enforcement proceedings in lieu of C&D letters.”
Still, the sequence of events to enable the current situation in Nevada is more of a confluence of results favorable for Nevada than an easily replicable formula. Nevada has benefitted from the actions and inactions of federal courts so far, which are outcomes that other states may not receive the benefits of.
Until the full course has run in the Nevada court system, it’s too early to tell whether Nevada will be an outlier with success reigning in prediction markets or if these victories for the NGCB will be short-lived. From a broader perspective, there are still many moving parts across the country as well in terms of Kalshi’s long-term prospects.
Divergent rulings from numerous federal courts across the country make it more likely that the US Supreme Court will grant cert to an appeal. Barring action from Congress, that’s the likely destination for all of the ongoing prediction market litigation.
Setting the stage for a US Supreme Court appeal
The CFTC and DOJ lawsuits mark a clear escalation in the fight over whether states can regulate exchange-based event contracts, following Arizona Attorney General Kris Mayes’ filing of criminal charges against Kalshi. Nevada is currently pursuing civil penalties, but the option to bring criminal charges remains on the table.
If Nevada succeeds in blocking Kalshi while federal appellate courts ultimately affirm federal preemption, it would set up a direct conflict, strengthening the case for Supreme Court review over a fragmented, state-by-state regulatory regime. A federal government appeal would further increase the likelihood of cert being granted.
For now, event contract trading remains off limits in Nevada. But that status may ultimately hinge on how far this federal preemption fight goes.
