Court temporarily blocks Tennessee regulators’ action against Kalshi

Key Takeaways

• A federal court issued a temporary restraining order in favor of Kalshi to stop Tennessee from enforcing state gambling laws against it.
• Judge Aleta Trauger concluded that Kalshi will be’very likely to succeed on its claims and would suffer irreparable damage without the restraining order’.

A federal judge in the United States has issued a temporary restraining order that stops Tennessee officials from enforcing state gambling laws against Kalshi, the leading prediction market platform.

The ruling is a response to the Tennessee Sports Wagering Council (SWC)’s move to block Kalshi, along with Polymarket and Crypto. The company – from providing sports contracts to residents – issuing cease and desist calls for the order of com, warning of fines or legal action against noncompliance.

Hence, under Tennessee law, state officials argue that the platforms’ offerings are considered to be sports wagering and therefore require licensing, consumer protections and tax payments.

Judge Aleta Trauger, of the US District Court for Appeals for the Middle District of Tennessee, in the order issued January 12, said Kalshi would likely be irreparable damage if Tennessee enforced its sports wagering and gambling statutes against it.

The order prohibits the SWC, its chairman and executive director as well as the state attorney general from pursuing action against Kalshi after a preliminary injunction hearing scheduled for January 26.

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