Washington has joined a growing wave of states suing prediction-market platforms, filing suit Friday against Kalshi and accusing the exchange of running gambling operations that evade state gambling laws. What Washington alleges - The state says Washington maintains a tightly regulated gambling regime, including a ban on online gambling, and that Kalshi’s products circumvent those rules. - According to the complaint, Kalshi’s website and app present “a range of events that they can bet on and the odds for those various events,” which Washington says functions like a sportsbook. The state alleges Kalshi markets these products as “prediction markets” to avoid being labeled “gambling,” even advertising “legal betting.” - The filing accuses Kalshi of violating state definitions of “gambling,” “professional gambling,” and “bookmaking.” It also alleges Kalshi’s offerings promote gambling addiction and specifically target college students. Kalshi pushes back Kalshi moved to transfer the case to federal court, saying it is already litigating related questions in other federal venues and that Washington initiated the suit without prior warning or dialogue. Elisabeth Diana, Kalshi’s head of communications, told CoinDesk the company does not offer “war markets” and is a “regulated, nationwide exchange for real-world events” that falls under exclusive federal jurisdiction. “We are confident in our legal arguments,” she said. What this means nationally The Washington suit is the latest sign of an escalating state-level crackdown on prediction markets. Providers and some regulators — including Commodity Futures Trading Commission Chair Mike Selig — argue these platforms offer federally regulated derivatives contracts. Several states counter that the products are essentially gambling dressed up as financial instruments and should be subject to state gambling laws. Legal observers expect the dispute over jurisdiction and product classification could ultimately reach the U.S. Supreme Court. Recent related rulings in Nevada - A week before Washington’s filing, an appeals court allowed Nevada to seek a temporary restraining order against Kalshi, forcing the exchange to remove sports, entertainment and election contracts for at least two weeks. A hearing to decide whether to extend that restriction is scheduled for Friday, April 3. - Trade outlet Gambling Insider reported that Kalshi users in Nevada were still able to access the platform after the TRO went into effect. Coinbase caught up in Nevada action Nevada also won a preliminary injunction against Coinbase, ordering the company to keep pausing prediction-market offerings in the state. In an order dated March 26, Nevada District Judge Kristin Luis noted Coinbase did not dispute it offered “event-based contracts” tied to sports and elections that meet Nevada’s definition of “sports pools.” The judge’s order — which links Coinbase to Kalshi via their partnership — bars Coinbase from offering sports, election or entertainment contracts in Nevada until the larger litigation is resolved, and gives the company 60 days to implement technological changes to comply. Jurisdictional backdrop Both the Nevada and Washington federal district courts sit within the Ninth Circuit, a detail that may matter as these fights potentially advance through appeals. UPDATE (March 28, 7:43 pm UTC): Story updated with comments from Kalshi’s spokesperson. Read more AI-generated news on: undefined/news