Prediction markets group asks 20 state auditors to probe casino lobby connections
A trade group representing Kalshi Inc., Crypto.com, and other prediction market operators asked auditors and inspectors general in 20 states to investigate casino lobbying efforts to restrict prediction markets. The request targets potential conflicts of interest or improper influence by established gambling interests. The move escalates a state-level regulatory fight between the emerging event-contract industry and casino operators.
Kalshi and Crypto.com are flipping the script from defense to offense in state capitals. Instead of waiting for more state bans or tax bills, they are asking auditors to treat casino lobbying as a corruption risk that merits official review. If even a handful of auditors open formal probes, the casino industry's legislative momentum stalls while investigators demand documents and testimony. That delay buys prediction market operators time to litigate preemption claims and lobby for friendlier rules. The risk cuts both ways: auditors who find no wrongdoing will hand casino lobbyists a clean bill of health they can wave in future legislative fights against event-contract platforms.
This offensive by a trade group representing Kalshi Inc.and Crypto.com joins a broader fight that already includes Kalshi's parallel preemption lawsuits in Illinois, Michigan and Kentucky, with the CFTC separately suing Minnesota and Kentucky.