Padres face questions over Kalshi partnership as sports betting stays illegal in California
Prediction market Kalshi has partnered with the San Diego Padres and other Major League Baseball teams, a move that draws scrutiny because traditional sports betting remains illegal in California, according to reports. Social media commentary criticized MLB's relationship with gambling, noting that players have faced harassment from bettors. The partnership raises questions about whether the deal was the right call given the state's regulatory environment.
Kalshi's Padres deal arrives while state attorneys general are already hunting for evidence that event-contract platforms market like unlicensed sportsbooks. California's prohibition on traditional sports betting makes the partnership an immediate political target: any stadium signage or social promotion can become an exhibit in a state enforcement action that undermines Kalshi's federal preemption defense. The platform spent heavily on MLB exclusivity to outflank rivals in states that block sportsbooks, but that same visibility widens its litigation exposure.
The NFL has already branded Kalshi and Polymarket products as 'bets', and the Ninth Circuit just stripped Kalshi's federal shield in Nevada. A California attorney general filing would join Connecticut, Nevada, and parallel suits already running, compounding legal spend while fragmenting the national sports market. Geofencing the country's largest state would strike at the economics of the entire MLB partnership strategy.