Arkansas Sues Kalshi, Alleging It Runs an Illegal Gambling Platform

Arkansas Attorney General Tim Griffin sued Kalshi on Wednesday, alleging its sports contracts amount to illegal gambling and bypass state controls on casinos and sports betting.

Griffin's complaint says the platform lets users as young as 18 wager on sports and entertainment outcomes, despite state rules barring gambling through unregulated platforms. It asks a judge to find Kalshi violated Arkansas' deceptive trade practices law and to order damages.

Griffin's challenge puts Arkansas into a growing dispute over whether states can treat Kalshi's sports contracts as wagers or whether they fall under federal derivatives oversight. Kalshi has argued that its contracts are financial derivatives overseen by the Commodity Futures Trading Commission (CFTC), not gambling.

The CFTC has separately sued Utah, arguing that the federal government alone has authority to regulate the contracts. The Arkansas case adds to the state-level challenge over Kalshi's sports market, while the company's position rests on federal derivatives regulation and oversight.