Arizona Attorney General Kris Mayes has filed charges against prediction marketplace Kalshi.
The battle between the new form of betting and state oversight has been simmering for some time.
According to a release issued by the AG, the state alleges that Kalshi accepted bets from Arizona residents on a wide range of events in violation of Arizona law.
These events included sporting contests, proposition bets on individual player performance, and whether the SAVE Act would become law.
The AG adds that four charges include election wagering, including bets on the 2028 Presidential race and the 2026 Arizona race for governor.
In Arizona, election betting is illegal, and state law explicitly bans wagering on elections, and engaging in such activity is classified as a class 2 misdemeanor.
Mayes said that Kalshi is making a habit of suing states rather than following the state laws, noting that Kalshi has taken legal action against Iowa and Utah and, more recently, Arizona.
“Rather than work within the legal frameworks that states like Arizona have established, Kalshi is running to federal court to try to avoid accountability.”
Prediction markets have taken the stance that they are different than gambling enterprises and they are regulated by federal authorities, in this case, the Commodities Futures Trading Commission (CFTC).
Arizona notes that last week, a federal court in Ohio denied Kalshi’s request for a preliminary injunction, making clear that the company’s operational convenience does not override a state’s authority to enforce its laws.
The dustup between the two sides, state versus federal oversight, may eventually come down to a Supreme Court decision or federal legislation that pre-empts state law.
