Nevada authorities demand Kalshi to address cease-and-desist order concerning sports and elections contracts
Let's Talk Nevada: Election Wagering and Kalshi
Nevada* Sports Betting Election Wagering Kalshi Nevada Gaming Control Board Prediction markets Regulation Buck Wargo, our website
Y'all might be interested... Nevada's playing some tough politics lately with prediction market maker, Kalshi. Here's the lowdown: Despite receiving a cease-and-desist order from the Nevada Gaming Control Board (NGCB) on March 4, Kalshi ain't done in the Silver State just yet.
Straight from the horse's mouth The NGCB initially gave Kalshi until March 14 to respond, but late last week, they extended the deadline - no hard feelings, right? The NGCB noted that it didn't mind Kalshi's lawyer askin' for a wee bit more time to, er, answer their demands.
So, what's the beef with Kalshi, anyway? Well, their event-based contracts that guess political outcomes, like who's going to win the elections, is a no-no in Nevada. The NGCB argues that these contracts are illegal unless Kalshi's licensed as a gaming company by the Nevada Gaming Commission.
Hot off the press In the demand letter signed by NGCB Chair, Kirk Hendrick, Kalshi was informed that they're violating Nevada laws and regulations, and that breaking those rules might lead to a little trouble, including criminal charges.
But here's the twist - a federal court in Nevada recently granted Kalshi a preliminary injunction, which means that for now, they can keep offerin' their prediction markets in the state as the case gets sorted out. This ain't the final word, though - future hearings could still shake things up.
The Big Picture Kalshi's been fightin' Nevada for the right to operate as a prediction market - licensed by the Commodity Futures Trading Commission (CFTC) instead of the Nevada Gaming Commission. Nevada's argued that even though Kalshi ain't a traditional sports pool, they still need to be licensed to operate in Nevada. But the federal court thinks otherwise, for now.
So there you have it. Kalshi and Nevada goin' back and forth, and prediction markets sales still sailin' smoothly for the time being. It's worth keepin' an eye on, though, as things can change quickly in the world of gambling regulation.
Sources:1. Nevada Gaming Control Board press release, March 18, 2023.2. Complaint, State of Nevada v. Kalshi, U.S. District Court for the District of Nevada, case number 3:23-cv-00391.3. Reply Brief in Support of Plaintiff's Application for Preliminary Injunction, State of Nevada v. Kalshi, U.S. District Court for the District of Nevada, case number 3:23-cv-00391.4. "Nevada Gaming Control Boardders Kalshi to Cease and Desist from Offering Unlicensed Gaming Activities Including Prediction Markets Related to Sports Events and Elections," Buck Wargo, March 4, 2023.5. "Nevada casino regulator accuses Kalshi of operating unlawful prediction markets without a license," Legal Sports Report, March 4, 2023.6. "Nevada Prediction Market Operator Kalshi Granted Preliminary Injunction Against State," Sports Handle, March 17, 2023.
Despite the Nevada Gaming Control Board's (NGCB) initial cease-and-desist order, Kalshi continues to operate in Nevada in the realm of sports-betting and election wagering.
The NGCB has extended the deadline for Kalshi to respond to their demands, as they face potential legal consequences for violating Nevada laws and regulations in their operation of prediction markets.
Kalshi sees itself as a prediction market maker, licensed by the Commodity Futures Trading Commission (CFTC), rather than the Nevada Gaming Commission, igniting a debate about the regulation of such services in Nevada.
