Federal Judge Blocks Arizona from Prosecuting Kalshi Over Prediction Market Operations

Sun, 12 Apr 2026 09:41:00 +0200

Arizona prosecutors had charged Kalshi, a prediction market platform, with 20 counts of illegal wagering, claiming it was operating an unlawful gambling operation. However, a federal judge, Michael Liburdi, issued a temporary injunction preventing Arizona from enforcing its gambling laws against Kalshi. This decision also canceled a scheduled arraignment. The ruling followed a lawsuit filed by the Commodity Futures Trading Commission (CFTC), which argued that Kalshi's 'event contracts' qualify as 'swaps' under the Commodity Exchange Act, granting the federal government exclusive regulatory authority. The case is part of a broader legal conflict, as the federal government has also challenged Connecticut and Illinois over their attempts to regulate prediction markets. The Trump administration has generally supported these platforms, with Trump's eldest son advising Kalshi and Polymarket, and Trump's Truth Social planning its own crypto-based prediction market. The ruling highlights the o