Kalshi Starts Blocking Michigan Users After Judge Issues Temporary Ban

Kalshi has begun blocking Michigan users from placing sports-related trades on its platform after a state judge ruled against the prediction market company in an ongoing legal dispute.  

Ingham County Circuit Court Judge Rosemarie Aquilina issued a temporary restraining order on June 29 that bars the New York-based company from offering sports event contracts to residents in the Michigan sports betting market space while the underlying lawsuit works its way through the court system. 

The legal fight traces back to March, when Michigan Attorney General Dana Nessel sued Kalshi, claiming the company was running an unlicensed sports betting operation under the guise of financial trading products.  

Nessel's office argues that Kalshi's sports contracts function the same way traditional sports wagers do, even though the company markets them as event contracts similar to those used to hedge economic or agricultural risk. 

Michigan users trying to access sports markets on the app now see a notice stating they cannot open new positions in that category. Kalshi also sent an email informing account holders that sports markets are temporarily unavailable in the state due to the court order, while other offerings such as crypto, weather, and world news markets remain untouched.  

A company spokesperson said Kalshi disagrees with the ruling and plans to keep fighting the state's case. 

Michigan joins a growing list of states pushing back against Kalshi's sports contracts through the courts. The restraining order stays in place as litigation continues, with the next hearing set for July 13. 

Senate Democrats push back against interference

Michigan's fight over Kalshi is playing out against a wider battle in Washington, where a group of Senate Democrats is trying to keep the federal government from getting in the way of states doing exactly what Michigan just did.  

Senators Adam Schiff and Alex Padilla joined Richard Blumenthal, Jeff Merkley, and more than a dozen other Democratic colleagues in signing a letter urging the Senate Appropriations Subcommittee on Financial Services and General Government to stop the Commodity Futures Trading Commission (CFTC) from using federal money to block states and tribes from enforcing their own gambling laws against prediction market apps.

The senators argue in their letter that prediction markets have drifted far from their original purpose of helping hedge financial and agricultural risk and have instead expanded into sports, politics, and foreign affairs betting. They say this shift has contributed to underage gambling, gambling addiction, and financial harm, and that states and tribes, as the traditional regulators of gambling, should be free to respond through lawsuits or new legislation. 

The senators want the fiscal year 2027 appropriations act to bar the agency from spending federal funds on that kind of litigation, warning it risks turning the CFTC into a tool that helps prediction market companies sidestep consumer protections.