Ho-Nation and Wisconsin sue Kalshi and push Congress to restrict prediction markets
The Ho-Nation and the state of Wisconsin filed lawsuits against online prediction market platforms including Kalshi on November 12. The tribal nation and state allege the platforms operate illegally and are seeking federal legislative intervention from the new Congress. Tribal gaming operators argue venues like Kalshi divert revenue from tribal casinos that fund essential services. Kalshi maintains it operates under federal commodity law.
Congressional action would bypass the slow federal rulemaking that has left CFTC-registered platforms exposed to multiplying state suits. Kalshi already faces parallel litigation in Arkansas, Louisiana, Ohio, and Tennessee, with its co-founders summoned to felony arraignment in Utah. A federal statute restricting prediction markets would give tribal nations and state attorneys general the victory they cannot win through scattered litigation.
The incoming Congress must choose between preserving the CFTC's jurisdiction over event contracts or carving out protections for tribal gaming revenue. Kalshi's federal commodity law defense becomes irrelevant if Congress writes new restrictions into statute. The tribal lobbying push joins a crowded field of state enforcers, making federal legislative gridlock the platform's best remaining shield.