Ohio Cites Massachusetts Ruling in Kalshi Lawsuit
Ohio has become the latest state to cite a ruling from Massachusetts in their bid to classify prediction markets as gambling.
The ruling could now cause a domino effect, and potentially be decisive in turning the tide of legal opinion against Kalshi and their efforts to have prediction markets be classed as financial products rather than gambling.
Commodity Exchange Act Key to Kalshi Dispute
Kalshi is fighting legal battles on multiple fronts, with several states insisting that the event contracts traded on prediction markets are indistinguishable from wagers, particularly with regards to sports betting.
Kalshi, however, continues to hold that they offer a financial product, which is regulated by the Commodity Futures Trading Commission (CFTC) rather than state gaming bodies, under the Commodity Exchange Act (CEA). However, Massachusetts lawmakers argued that the CEA was not intended to override state laws.
The difference of opinion, which is the central dispute determining whether Kalshi is classed as offering financial or gambling products, has put Kalshi on the warpath with state regulators. Their current designation as financial products results in the company being able to skirt gambling laws, pay less taxes, and gain other advantages over traditional bookmakers.
Tide Could Turn Against Kalshi Across US
Thus far, Kalshi have been successful in defending their position, although a ruling from Suffolk County Superior Court Judge Christopher Barry-Smith in Massachusetts granted a request from the state’s attorney general, Andrea Campbell, for an injunction requiring them to cease offering contracts while a lawsuit against them took place.
That injunction was later postponed after Kalshi made several protests, including that they would not have time to roll out geolocation technology which would be required to prohibit individual users depending on their jurisdiction.
Despite the stay of execution, however, the injunction ruling was first seized on by Nevada lawmakers, who have been desperate to protect their vital gambling industry from unregulated competitors. New York, New Jersey and Tennessee also highlighted the ruling, and Ohio has now followed suit, submitting the Massachusetts ruling as supplemental authority in their own ongoing case.
The Ohio case has been ongoing since October 2025, when Kalshi launched a lawsuit after receiving a cease-and-desist letter from the Ohio Casino Control Commission, which regulates gambling in the state.
With the injunction postponed by Barry-Smith until further correspondence was received from both parties, a decision is likely to be made after February 6th, 2026. Should the injunction be upheld, lawmakers across the US are clearly hoping that it could prove vital in designating Kalshi as a gambling operator across the country.
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