- New York bill seeks regulation of prediction markets like Kalshi amid legal uncertainty.
- Kalshi faces state action over $63M in election contracts deemed unlicensed wagering.
- Google to feature Kalshi and Polymarket data as lawmakers debate gambling classification.
A New York legislator has introduced a bill seeking to regulate prediction-market providers such as Kalshi, despite growing concern that the emerging sector may be operating in violation of state gambling laws. According to a report, Assemblyman Clyde Vanel (D), who chairs the Assembly Banks Committee, unveiled Bill A.B. 9251 on Friday to establish a clear legal framework for prediction markets and empower the state attorney general’s office to take enforcement action against unlicensed operators.
Vanel stated that the proposal would provide regulators with statutory authority to impose guardrails on the fast-expanding industry, allowing users to trade on the outcomes of events ranging from elections to sports contests. While online sports betting is legal in New York, prediction markets occupy a legal uncertain zone not yet covered by existing statutes.
Kalshi Faces State Enforcement Over Election Contracts
The New York State Gaming Commission recently ordered KalshiEX LLC to halt operations involving election-related and sports-based contracts, accusing the firm of running an unlicensed mobile sports wagering platform. The directive, issued on October 24 by Executive Director Robert Williams, cited contracts tied to the New York City mayoral race between Zohran Mamdani and Andrew Cuomo. Kalshi’s platform had processed over $63 million in trades linked to the contest before regulators intervened.
Kalshi argues in court filings that its event-based contracts fall under the jurisdiction of the federal Commodity Futures Trading Commission (CFTC), not state gaming laws. The company claims that users are trading “shares” in event outcomes, treating them as commodity transactions rather than bets.
Integrity and Legal Oversight Concerns
Election watchdog groups have warned that monetizing political outcomes could decrease trust in democratic processes. Susan Lerner of Common Cause New York told The Gothamist that turning elections into betting events “devalues the actual impact of voters’ choices,” adding that such activity could undermine public trust in the system.
Google Adds Prediction Data to Finance Tools
The legislative push comes as Google prepares to integrate prediction-market data from Kalshi and Polymarket into its Google Finance tools. The feature will display real-time probabilities for economic and political events based on market activity.
Both platforms describe their products as “event contracts,” but several U.S. senators have argued they resemble repackaged gambling. Polymarket remains restricted to “view-only” mode in the U.S., while Kalshi continues to face regulatory disputes in multiple states, a legal battle that could determine how prediction markets operate nationwide.
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