The Heat Is On: Connecticut Probes Kalshi, Illinois Sends C&D
Connecticut’s Department of Consumer Protection (DCP) has Kalshi in its sights, launching an investigation into the prediction market operator, per a Covers.com report. In the meantime, the company was slapped with a cease-and-desist letter from Illinois.
Fourth State Targets Operator
The DCP’s Gaming Division kicked off the probe last fall, suspecting Kalshi’s event contract trading breaks state law. “The DCP Gaming Division has an open investigation into prediction market exchange Kalshi, which is suspected of operating in violation of Connecticut law,” said spokesperson Kaitlyn Krasselt to Covers.com.
Details are slim for now: DCP’s keeping it tight-lipped beyond confirming it’s been digging for months.
This makes Connecticut the fourth state to move on Kalshi, joining Nevada, New Jersey, and Ohio, where gaming regulators sent cease-and-desist letters over sports event contracts.
Kalshi’s platform lets users trade yes-or-no bets on real-world outcomes, drawing $200 million in sports trades since January, per industry stats. But states with legal betting, like Connecticut’s $1 billion market in 2024, per state figures, see it as unlicensed gambling stepping on their turf.
Illinois Goes Harder
Illinois isn’t playing coy like Connecticut. The Illinois Gaming Board (IGB) slapped Kalshi with a cease-and-desist letter, accusing it of breaching the state’s Sports Wagering Act and Criminal Code, per EGR North America.
“The IGB alleges Kalshi’s activities constitute illegal gambling,” the letter states, also hitting Robinhood and Crypto.com with the same order.
Illinois says these platforms, raking in trades on games without a license, dodge the rules.
Connecticut’s quieter stance leaves questions. While Illinois calls out specific laws, DCP’s “suspected violation” line lacks meat, per Krasselt’s statement.
Still, the heat’s on. Nevada’s Gaming Control Board started the crackdown in March, followed by New Jersey and Ohio. Kalshi’s fighting back, suing Nevada and New Jersey, claiming federal Commodity Futures Trading Commission (CFTC) oversight trumps state gripes.
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