1. Nevada Delivers Its Sharpest Blow Yet to Kalshi
A Nevada state court has issued a temporary restraining order against prediction market platform Kalshi, barring the company from offering event contracts tied to sports, elections, and entertainment within the state for a period of up to 14 days. District Court Judge Jason Woodbury of the First Judicial District signed the order on Friday, March 20, following a request filed by the Nevada Gaming Control Board on March 12. The order halts Kalshi's operations in Nevada immediately and sets an April 3 hearing date at which the court will evaluate whether a longer-term preliminary injunction is warranted.
The ruling arrives at a particularly sensitive moment for Kalshi, coming just days after Arizona's attorney general filed 20 criminal counts against the company for operating an unlicensed wagering business and accepting election bets in violation of that state's laws. Together, the two enforcement actions represent an accelerating pattern of state-level legal pressure that is directly challenging Kalshi's core operating thesis: that its federally regulated derivatives classification preempts state gambling law.
2. The Path That Led to Friday's Order
The Nevada Gaming Control Board's effort to remove Kalshi from the state has a history extending back to 2025, when the regulator issued a cease-and-desist order directing Kalshi to stop offering sports event contracts. Kalshi responded by suing the NGCB in federal court — a pattern of preemptive federal litigation that the company has deployed across multiple states — and initially obtained a preliminary injunction that allowed it to continue operating in Nevada during the proceedings.
That early victory was subsequently undone. A federal court judge dissolved the preliminary injunction that had been keeping Kalshi active in Nevada, at which point the NGCB pursued its civil enforcement action in state court and requested the temporary restraining order that was granted on Friday. The day before the state court acted, the Ninth Circuit Court of Appeals rejected Kalshi's bid to stay the lower court proceedings through an emergency appeal, clearing the path for Nevada regulators to move forward at the state level without federal court interference.
The sequence — federal court injunction granted, then dissolved; Ninth Circuit stay denied; state court TRO granted — represents a significant deterioration in Kalshi's legal position in Nevada compared to the position it held when it launched its preemptive federal litigation strategy.
3. How the Court Framed Its Decision
Judge Woodbury's order was accompanied by reasoning that addresses the core legal question at the heart of the state-versus-federal jurisdictional dispute: whether Kalshi's CFTC registration and federal derivatives classification preempts Nevada's gaming regulations. The court sided with the state on this fundamental question.
The judge's written determination found that the Nevada Gaming Control Board is reasonably likely to succeed on the merits of its underlying case — meaning that in the court's assessment, if the case went to trial, Nevada would probably prevail in its argument that Kalshi is operating in violation of state gaming law. The court framed Nevada's "expansive and strict" gaming regulation framework as serving a legitimate public interest, and characterized the harm from allowing an unlicensed operator to continue activities pending the outcome of litigation as irreparable.
Crucially, the order characterizes Kalshi's sports event contracts as qualifying as operation of a "sports pool" under Nevada law, and concludes that because Kalshi collects a commission on trading activity, it is operating a "percentage game" — both categories requiring licensing under Nevada's regulatory framework. The court further determined that "an unlicensed participant beyond the Board's control, such as Kalshi, obstructs the Board's ability to fulfill its statutory functions," elevating the order's rationale beyond a simple licensing dispute to a structural interference with the regulatory body's capacity to do its job.
4. The Ninth Circuit's Role in Clearing the Way
The day before the state court issued its TRO, the Ninth Circuit Court of Appeals dealt Kalshi a procedural blow that directly enabled Friday's ruling. Kalshi had sought an emergency stay from the appellate court to prevent state-level proceedings from advancing, arguing that the case properly belonged in federal court given the CFTC's regulatory framework. The Ninth Circuit rejected that request, sending the matter back to Nevada state court.
This appellate ruling is significant because Kalshi's core litigation strategy across multiple states has been to invoke federal jurisdiction as a means of preventing state gaming regulators from enforcing their own laws. The Ninth Circuit's refusal to stay the state proceedings — even temporarily — signals that the federal appellate courts are not treating the federal jurisdiction argument as an automatic trump card that overrides state-level enforcement action. For a company that had built its legal defense around the primacy of CFTC oversight, this is a meaningful signal about the limits of that strategy in the current judicial environment.
5. What the TRO Actually Prohibits
The temporary restraining order is comprehensive in scope. It prohibits Kalshi from offering or facilitating event-based contracts relating to sports, elections, and entertainment events in Nevada for the 14-day period. It also explicitly bars Kalshi from accepting trading on those events from any person under the age of 21 — a provision that reflects Nevada's concern about Kalshi's lack of age-verification requirements consistent with licensed gambling operations in the state.
Under Nevada law, temporary restraining orders cannot be appealed directly. Kalshi does have the option of filing a motion to take the issue to the Nevada Supreme Court, but the 14-day duration of the order means the April 3 preliminary injunction hearing is the more practically relevant next legal event. At that hearing, the court will determine whether the TRO should be converted into a longer-lasting preliminary injunction that would remain in effect throughout the underlying litigation.
6. Nevada's Broader Campaign Against Prediction Markets
The Kalshi TRO completes a comprehensive sweep by Nevada gaming regulators against prediction market operators they view as operating unlicensed gambling businesses in the state. The Nevada Gaming Control Board's chairman declared in a statement following Friday's order that the board had "successfully restricted the operation of all unlicensed prediction markets that had been known to be operating in Nevada" — a statement that frames the Kalshi action as the final piece in a systematic enforcement effort.
Two other major platforms — Robinhood and Crypto.com — ceased offering event contracts in Nevada in 2025 under pressure from state authorities, avoiding the litigation path that Kalshi pursued. Polymarket has also previously faced temporary restrictions in Nevada. The Nevada Gaming Control Board separately filed a civil enforcement action against Coinbase in February in connection with its prediction market products.
The pattern that emerges is one of Nevada taking a consistent, hard-line position across the entire category of prediction market operators, regardless of their federal regulatory status, treating their products as unlicensed gaming activity under state law.
7. The Federal-State Jurisdictional Clash Sharpens
Friday's Nevada order crystallizes the fundamental jurisdictional conflict that has been building across multiple states simultaneously. On one side stands the CFTC's assertion of exclusive federal jurisdiction over event contracts, framed in the new guidance issued earlier this month as part of the agency's push to treat prediction market platforms as regulated derivatives venues rather than gambling operators. On the other side stand state gaming regulators in Nevada, Arizona, Ohio, Massachusetts, and elsewhere who maintain that their authority to regulate gambling within their borders is not displaced by the CFTC's framework.
No federal court has issued a definitive nationwide ruling that resolves this conflict. The patchwork of outcomes across different jurisdictions — federal courts in Tennessee blocking state enforcement, Nevada courts supporting it, Ohio courts going the state's way — reflects a genuinely unresolved legal question that is being litigated simultaneously across multiple venues. The April 3 Nevada hearing will add another data point to this evolving picture but is unlikely to provide the comprehensive resolution that would settle the question across all jurisdictions.
8. Kalshi's Strategic Predicament
The accumulation of adverse legal developments over the past week — the Arizona criminal charges, the Ninth Circuit's refusal to stay Nevada proceedings, and the state court's TRO — creates a more challenging operating environment for Kalshi than it has faced at any prior point in its multi-state legal battles. Each adverse ruling provides additional legal precedent and rhetorical ammunition for other states considering enforcement actions, while reducing the credibility of Kalshi's federal preemption argument as its primary defense mechanism.
Kalshi declined to comment on the Nevada development. The company has consistently maintained that its products are federally regulated derivatives subject to CFTC oversight and that state gaming law does not apply to its operations. That position remains legally viable — it has prevailed in some courts — but it is under increasing pressure from a coordinated pattern of state enforcement that is progressing faster than Kalshi's litigation strategy can contain.
9. Industry Implications Beyond Kalshi
The Nevada TRO is not exclusively a Kalshi problem — it is a signal to the entire prediction market industry about the limits of relying on federal regulatory status as a shield against state enforcement. Every operator in the prediction market space that is or has considered offering sports, election, or entertainment event contracts in states with robust gaming regulatory frameworks faces the same underlying legal exposure that Kalshi is now navigating in Nevada and Arizona.
The willingness of Nevada — the state with the most established and sophisticated gaming regulatory framework in the United States — to pursue comprehensive enforcement against all unlicensed prediction market operators sends a message about the industry's operational assumptions that is difficult to dismiss. A business model built on the premise of national, undifferentiated access to prediction market products is facing a sustained challenge from state authorities that shows no signs of abating.
10. What Comes Next
The April 3 hearing at the First Judicial District Court of Nevada is the immediate legal milestone. At that proceeding, the court will determine whether to grant a preliminary injunction — a longer-lasting court order that would remain in effect while the underlying litigation proceeds, potentially for months or years. The standard for a preliminary injunction is higher than for a TRO: the court must find a substantial likelihood of success on the merits, meaningful harm if the injunction is denied, and that the balance of equities favors the requesting party.
Given the court's finding that the NGCB is "reasonably likely to succeed on the merits" — the key finding underlying the TRO — Kalshi faces a difficult task in persuading the same judge that the preliminary injunction standard is not met. The outcome of April 3 will determine whether Kalshi's Nevada exclusion is a two-week disruption or the beginning of an extended, potentially permanent removal from one of the country's most visible gaming markets.