- Louisiana has filed a lawsuit against Kalshi, Robinhood, Polymarket and several other prediction market platforms.
- The state has raised concerns about illegal betting and the platforms’ compliance with local laws.
- The companies argue that prediction markets should be regulated by the federal Commodity Futures Trading Commission (CFTC).
Louisiana Takes Legal Action On Prediction Markets
US state Louisiana has launched legal action against a number of big prediction market platforms, including Kalshi, Robinhood, Polymarket, Crypto.com, Coinbase and Gemini after they “were violating Louisiana law”, according to the state’s Attorney General Liz Murrill.
🚨Breaking: Louisiana judge orders temporary restraining order prohibiting Kalshi, Polymarket, Coinbase, Robinhood, and other “prediction market” operators from continuing their unlicensed and unregulated illegal gambling in Louisiana.
It’s not complicated: if you aren’t a licensed gaming operator, you aren’t legal. Illegal gambling is a crime and is subject to jail time and significant penalties. Judges all over the country have overwhelmingly called this activity what it is: gambling. Kalshi’s and the other operators’ attempts to make up new words to evade state gambling laws, regulators, and taxes are not fooling anyone.
— Attorney General Liz Murrill (@AGLizMurrill) November 12, 2026
This is the latest example of the legal battle between states and the Federal Government over regulating prediction markets. Currently Louisiana is the 11th state to launch legal action against one or more of the platforms and are seeking an emergency injunction.
Prediction Markets & Restrictions
Prediction markets allow users to place trades on contracts relating to potential outcomes of future events, such as elections, sporting events and others. Since the 2024 US presidential election the platforms have become hugely popular.
However several states have voiced concerns that some of the contracts are similar to a sports betting platform, and that they are not being run under state gambling laws. Tribal organisations have also raised concerns over any potential impact to current gambling agreements.
However the companies argue their platforms are regulated under Federal law and should be regulated by the Commodity Futures Trading Commission (CFTC) instead of individual states.
Kalshi have prepared for the legal action and Robinhood have stated their event contracts are regulated under Federal law via its CFTC registered subsidiary.
Potential Legal Action From Higher Courts
Coinbase has criticised the state approach, claiming it creates a patchwork approach. The Coalition for Prediction Markets, which represents several platforms, has also said the lawsuit is attempting to illegally impose state regulation on markets that are regulated under Federal law.
The CFTC has also launched legal action against some states, trying to enforce its sole regulation over event contracts. This could go as far as the US Supreme Court.
This latest lawsuit comes at a time where prediction markets are coming under increased scrutiny. It has been reported that the CFTC is looking into whether Kalshi properly notified the regulator of certain proposed contracts and whether Polymarket followed through on a previous agreement to restrict US users from using its overseas platform.
This could have a huge impact on the future of prediction markets in the United States. However for now the industry is in limbo while state and Federal authorities disagree.
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