Federal judge lets Utah enforce ban on Kalshi

A federal judge ruled that Utah can enforce its anti-gambling laws against Kalshi and similar prediction markets, rejecting the company’s bid to stop the state from applying its sports betting restrictions. U.S. District Judge Robert Shelby granted summary judgment to the state defendants and denied Kalshi’s request for a preliminary injunction.

Utah’s attorney general said the ruling means the state can keep pressing ahead against Kalshi’s sports contracts. The office said Kalshi sued in February and argued that its status as a federally registered exchange should shield it from Utah’s gambling rules, but the court disagreed.

In his memorandum decision, Shelby said the federal commodities law Kalshi relied on does not preempt Utah’s ability to enforce its anti-gambling laws. He wrote that the Commodity Exchange Act gives the Commodity Futures Trading Commission exclusive jurisdiction over some swaps traded on designated contract markets, but that a savings clause preserves the jurisdiction of state regulators and courts.

The judge also pointed to a separate preemption provision in the statute that applies only to certain swaps traded off designated markets. He said Kalshi had not shown it would be impossible to comply with both Utah law and the federal regime.

AP reported that Kalshi and Polymarket let users buy and sell contracts tied to the probable outcome of events, with prices typically ranging from 1 cent to 99 cents. Kalshi says its sports business is large, with more than $1 billion traded on the Super Bowl alone, and AP reported that the bulk of Kalshi’s trading volume and roughly half of Polymarket’s are tied to sports.

The ruling lands in the middle of a national split over prediction markets. AP reported that courts in Maryland, Nevada, Ohio, New York and Wisconsin have ruled against Kalshi in similar cases, while judges in New Jersey, Tennessee, Arizona and Minnesota have sided with it. Other states have been allowed to curb some parts of Kalshi’s business without banning the platforms outright.

Utah’s resistance reflects a long-standing hostility to gambling. For more than a century, the state has kept gambling almost entirely out, with no casinos, lotteries or racetracks that allow bets, a stance rooted in the culture of the Church of Jesus Christ of Latter-day Saints. Gov. Spencer Cox has called prediction markets gambling and said he will sign legislation aimed at undercutting Kalshi and Polymarket, while Kalshi said it disagrees with the ruling and plans to appeal.