Kentucky Sues Kalshi, Polymarket Over Illegal Sports Betting Allegations This Week

According to Kentucky Attorney General Russell Coleman, Kentucky sued Kalshi and Polymarket this week, alleging the platforms operate illegal sports betting services and evade state gambling regulations. "Kalshi and Polymarket are operating illegal sportsbooks in Kentucky and breaking our laws," Coleman said in a statement.

The platforms argue their contracts qualify as swaps under federal Commodity Futures Trading Commission (CFTC) jurisdiction, a position backed by President Trump's administration. The CFTC and Justice Department have sued states attempting to regulate prediction markets, while federal judges have issued conflicting rulings across jurisdictions. Legal experts expect the dispute will ultimately reach the U.S. Supreme Court.