News Summary
The Massachusetts Attorney General’s Office has filed a lawsuit against Kalshi, an online trading platform, for allegedly operating an illegal sports betting service without state licenses. The lawsuit claims Kalshi processed over $1 billion in wagers in the first half of 2025, with over 75% of its trading volume linked to sports events. As regulators raise concerns regarding Kalshi’s business practices, the platform faces multiple legal battles and scrutiny over its marketing strategies targeting younger users.
Boston, Massachusetts – The Massachusetts Attorney General’s Office has filed a lawsuit against Kalshi, an online trading platform, alleging that it operates as an illegal sports betting service without acquiring the necessary state licenses. The lawsuit, filed on Friday in Suffolk County Superior Court, claims that Kalshi has taken in over $1 billion in sports wagers during the first half of 2025.
The lawsuit’s details reveal that more than 75% of Kalshi’s trading volume is linked to sports events, drawing a direct comparison to nationally recognized licensed sportsbooks like DraftKings and FanDuel. The Attorney General, Andrea Campbell, claims that Kalshi earns a greater percentage of its revenue from sports betting relative to these established operators. Furthermore, the complaint asserts that Kalshi mimics “a digital gambling experience” and utilizes behavioral design techniques that relate to gambling psychology.
Kalshi recently introduced a parlay product and has been promoting its services as a sports betting platform. This development, combined with its heavy marketing strategies that include promotions through social media and partnerships, has drawn scrutiny from regulatory bodies. In March 2025, the Massachusetts Secretary of the Commonwealth launched an investigation into Robinhood for providing sports event contracts, signaling the increasing concern about the legality of sports prediction markets.
The lawsuit is not Kalshi’s only legal battle; it faces multiple lawsuits from regulators in Maryland, Nevada, and New Jersey, while still operating in those states amid ongoing litigation. Continuing its legal challenges, Kalshi has recently received preliminary injunctions in favor in Nevada and New Jersey, though these decisions are currently under appeal. However, a Maryland court has sided with the state against Kalshi, while state enforcement has been put on hold as the company pursues an appeal.
As the nation’s interest in sports betting continues to rise, various state authorities are taking action against Kalshi. The Michigan Gaming Control Board is investigating sports prediction markets, while Tennessee’s Sports Wagering Council has requested federal authorities to intervene and shut down these platforms. The Commodity Futures Trading Commission (CFTC) oversees Kalshi’s event contracts, although there are concerns about enforcement and oversight from outgoing commissioners.
Kalshi’s business model raises red flags regarding responsible gambling practices. The Attorney General’s complaint emphasizes that Kalshi provides minimal safeguards against gambling addiction and financial losses compared to licensed competitors. Furthermore, the platform’s marketing strategies appear to target younger users aged 18-21, even though Massachusetts law stipulates a minimum betting age of 21.
Before facing legal actions, Kalshi had initially branded itself as “The First Nationwide Legal Sports Betting Platform.” However, it subsequently changed its description of services to “trading” after receiving cease-and-desist orders from several states. In Massachusetts, licensed operators are mandated to pay a hefty fee of $5 million for a five-year operational license, in addition to an annual fee of $1 million—expenses that Kalshi has bypassed by claiming that it falls under CFTC jurisdiction instead of state regulations.
Federal courts have previously sided with Kalshi in disputes against gaming regulators in Nevada and New Jersey, allowing the company to continue its operations while litigation unfolds. Meanwhile, several states, including Arizona and Montana, have issued cease-and-desist orders prohibiting Kalshi from offering sports betting services.
The platform’s rapid rise is underscored by its impressive trading volumes; reports indicate that Kalshi processed approximately $441 million in trading volume during the first four days of the 2025 NFL season alone, with an astounding $200 million processed on September 7. For August 2025, the platform recorded a trading volume of $875 million and is reportedly considering a funding round that could double its current valuation. As regulators adjust to the evolving landscape of sports betting, Kalshi’s aggressive growth further complicates its regulatory challenges.
Deeper Dive: News & Info About This Topic
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Author: STAFF HERE BOSTON WRITER
BOSTON STAFF WRITER The BOSTON STAFF WRITER represents the experienced team at HEREBoston.com, your go-to source for actionable local news and information in Boston, Suffolk County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as Boston Marathon, Head of the Charles Regatta, and Boston Harborfest. Our coverage extends to key organizations like the Greater Boston Chamber of Commerce and Associated Industries of Massachusetts, plus leading businesses in finance, biotech, and insurance that power the local economy such as Fidelity Investments, Biogen, and Liberty Mutual Insurance. As part of the broader HERE network, we provide comprehensive, credible insights into Massachusetts's dynamic landscape.
