A Washington state judge has granted a preliminary injunction against Kalshi, the prediction market platform, barring it from offering contracts in the state while a legal challenge proceeds. The ruling, issued in Thurston County Superior Court, rejected Kalshi's argument that federal commodities law overrides Washington's gambling regulations.
Why the state's case held up
Judge James Dixon found that Washington is likely to succeed in proving its claims that Kalshi's operations violate state gambling laws. The court wasn't convinced by Kalshi's central defense—that its registration with the Commodity Futures Trading Commission gives it immunity from state-level restrictions. “Federal registration does not displace state authority,” Dixon wrote in his order. The decision means Kalshi cannot accept new bets from Washington residents or allow them to place trades until the matter is resolved.
What happens next
The restrictions aren't final yet. The injunction will remain in place until August, when the court is expected to rule on a permanent ban. Both sides are due back for a hearing in late July. For now, the platform is blocked from operating in the state—a setback for a company that has argued its contracts are legal commodities trading, not gambling.
A broader legal fight
The case is one of several testing whether state gambling laws can apply to federally regulated markets. Kalshi has long maintained that its contracts—which let users bet on outcomes like election results or economic data—are protected by the Commodity Exchange Act. Washington's attorney general countered that the platform is essentially running a gambling operation, and the judge agreed the state's interest in preventing such activity likely outweighs any federal preemption claim.
The company hasn't said whether it will appeal the preliminary injunction. Its next legal move is due within two weeks. For Washington users who had accounts on the platform, the immediate effect is clear: they can't place new bets, and existing contracts may be affected as the case winds toward a final decision in August.
