A King County Superior Court judge has ordered Kalshi to stop offering a wide array of event contracts in Washington, the latest state-level escalation against prediction markets under scrutiny from regulators and prosecutors nationwide.
Judge John McHale signed an amended order Wednesday that sets the terms of a preliminary injunction he granted in July. Under it, Kalshi is barred from offering contracts tied to sports, elections, politics, entertainment, culture, tech and science and “mentions” to Washington residents, according to a Cointelegraph report. Contracts involving commodities, climate, economics and finance are exempt.
Washington Attorney General Nick Brown said Thursday the state is “holding Kalshi accountable for running an illegal gambling operation,” citing the ruling in a post on X.
Two compliance deadlines now apply. Kalshi must have IP-address and residency-based geofencing in place by Aug. 19. A full GeoComply multi-source geofencing system must follow by Sept. 2 to block Washington users from purchasing the covered contracts. The order sets both as hard conditions of the injunction.
McHale rejected Kalshi’s argument that the Commodity Exchange Act preempts Washington gambling law. The federal statute, he found, does not override the state’s authority. Washington showed a likelihood of success on claims under three state laws, though the specific statutes were not named in the report.
The Washington Court of Appeals denied Kalshi’s request to stay the injunction. The restrictions remain in place while the case proceeds. Kalshi maintains that the Commodity Futures Trading Commission has exclusive jurisdiction over its exchange. The court did not accept that position.
The practical upshot: Washington residents face geofenced access to a narrowed set of Kalshi markets. Sports, election and entertainment contracts are off limits, regardless of Kalshi’s federal-layering argument.
The order marks a shift in approach. Rather than litigating jurisdiction in the abstract, the court imposed technical compliance milestones with fixed dates. Whether other states pursuing similar scrutiny of prediction markets follow that template remains to be seen. Kalshi has not publicly responded beyond its CFTC-jurisdiction argument, the report states.
