Arizona Charges Kalshi with Unlicensed Gambling

Arizona Attorney General Kris Mayes filed criminal charges Tuesday against prediction market platform Kalshi, accusing the New York-based company of operating an unlicensed gambling business and accepting illegal bets on elections and sports events from state residents. The 20 misdemeanor counts, lodged in Maricopa County Superior Court, mark the first such criminal prosecution in the United States against a major player in the rapidly growing prediction markets industry.

Prosecutors allege that Kalshi, which brands itself as a federally regulated exchange for event contracts, allowed Arizona users to wager on professional and college sports outcomes, individual player performances, and political races, including the 2028 presidential election, the 2026 Arizona gubernatorial contest, and the Republican primary for that office. Arizona law prohibits unlicensed wagering operations and bans election betting outright, according to Mayes' office. The charges followed Kalshi's preemptive federal lawsuit against the state filed just days earlier, a move Mayes described as an attempt to evade accountability.

"Kalshi may brand itself as a prediction market, but what it's actually doing...