Kalshi Will Continue to Operate in Massachusetts After Emergency Motion
Kalshi’s sports event contracts will remain live in Massachusetts for now despite a preliminary injunction requiring the prediction market to temporarily cease operations in the state.
Massachusetts attorney general Andrea Campbell and the Massachusetts Gaming Commission sued Kalshi back in September 2025, and on 20 January 2026, an injunction was granted by judge Christopher Barry-Smith on January 20, forcing Kalshi to pause its sports offerings while the state began a lawsuit against the company.
However, an emergency motion tabled by Kalshi will now pause the injunction, after judge Barry-Smith agreed to hold back the ban on sports contracts until state lawyers responded to the request by a deadline on the 30 January.
Kalshi Gets Stay of Execution
According to reports, Barry-Smith opted to delay the injunctions due to concerns over how individuals who have already purchased contracts with Kalshi could be affected. However, on Friday, representatives from Campbell’s office stated that it was not their intention to void any existing contracts.
“We’re not looking to unwind any transactions that have already happened but want to prohibit subsequent transactions relating to those contracts,” said one of the representatives for Campbell’s office. “Otherwise, it’s just another version of sports wagering.”
Kalshi’s Massachusetts Appeal Explained
Kalshi’s case rests on three central pillars, the first of which is that its activities are covered by the Commodity Exchange Act, and that the company is registered with, and regulated by, the Commodity Futures Trading Commission in accordance with the act. However, Barry-Smith has already cast doubt on that defence, stating that the Commodity Exchange Act was designed to complement state laws rather than to overrule them.
Secondly, Kalshi argues that the costs associated with bringing in geolocation, which will be necessary to abide by the injunction, would be prohibitive, and the one-week deadline for introducing such technology to be unrealistic. However, this could be argued to be in breach of CTFC advice which asks futures commission brokers, particularly those dealing in sports contracts, to be prepared for any logistical and technological challenges if they are required to cease trading in any specific jurisdictions.
Lastly, in their 20-page memo, Kalshi’s representatives also made the simple point that the company had been successful in every other court case, stating that the Massachusetts court was “the first in the country to grant a motion for preliminary injunction against Kalshi-or any other prediction market-for allegedly operating in violation of state law. Every other court to issue injunctive relief has done so in favor of Kalshi.”
Massachusetts Could Set Dangerous Precedent for Kalshi
At present, both sides appear to think they stand a good chance of winning the case, but while Kalshi’s record has been formidable until this point, the risk of a precedent being set in Massachusetts could cause a domino-like effect in other states, where prediction markets continue to operate in a legal gray area despite their legal victories.
“The lay of the land on the central question here – whether the CEA preempts state law as applied to the trading of event contracts on a designated contract market – is deeply unsettled and evolving by the day,” the memo from Kalshi stated.
Following the 30 January deadline for the response from the state of Massachusetts, Kalshi’s attorneys will in turn have until the 4th of February to respond, after which Barry-Smith will make his decision.
Tags/Keywords
Players trust our reporting due to our commitment to unbiased and professional evaluations of the iGaming sector. We track hundreds of platforms and industry updates daily to ensure our news feed and leaderboards reflect the most recent market shifts. With nearly two decades of experience within iGaming, our team provides a wealth of expert knowledge. This long-standing expertise enables us to deliver thorough, reliable news and guidance to our readers.
Latest News
