Kalshi Wins Temporary Pause Against Connecticut Gambling Order

Core Viewpoint - A federal judge has granted Kalshi a temporary reprieve from enforcement actions by Connecticut regulators, who accused the company of operating unlicensed online gambling, as the legal dispute over Kalshi's regulatory status continues into early 2026 [1][3][9] Regulatory Challenges - Connecticut's Department of Consumer Protection (DCP) issued cease-and-desist notices to Kalshi, Robinhood, and Crypto.com on December 2, alleging they were offering unlicensed sports wagering through "online sports event contracts" [3] - Kalshi has filed a lawsuit against the DCP, asserting that its event contracts are governed by federal derivatives law and fall under the exclusive jurisdiction of the Commodity Futures Trading Commission (CFTC) [3][6] - The court has ordered the DCP to halt actions against Kalshi while the case is reviewed, with a response due by January 9 and further arguments expected by January 30 [4] Company Operations and Legal Position - Kalshi, designated as a federally regulated contract market by the CFTC, began offering event-based contracts nationwide earlier this year, covering markets related to sports, weather, and political outcomes [5] - The company contends that its products are federally regulated financial instruments rather than wagers, claiming that state actions against it violate the Commodity Exchange Act [6] - Kalshi is currently engaged in multiple legal battles across various states, including lawsuits against the New York State Gaming Commission, Massachusetts' attorney general, and regulators in New Jersey, Nevada, Maryland, and Ohio [7][9] Recent Developments - Kalshi has recently partnered with CNN, becoming the network's official prediction markets partner, and successfully closed a $1 billion funding round, achieving an $11 billion valuation [8]