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State of Play
- Kalshi’s federally regulated prediction markets let adults 18 and older place event-based bets nationwide, creating a new channel for gambling-like activity outside state sportsbook rules.
- These platforms look and feel like sportsbooks but operate under different protections and age limits, expanding access and potential harm.
Kalshi and other prediction market (PM) platforms sell event contracts – futures that pay out based on whether a specific event occurs (for example, whether Josh Allen wins NFL MVP).
The Commodity Futures Trading Commission (CFTC) shifted policy in 2020 to allow event contracts, and later eased restrictions on sports-related markets, letting Kalshi operate nationwide under federal oversight that doesn’t necessarily promote responsible gambling.
Kalshi says it is an exchange that “does not benefit from customers’ losses,” charging fees rather than taking the house side. However, it also runs a trading arm that buys and sells contracts on its own platform. Competitors such as Polymarket have faced enforcement actions in recent years, and state gambling regulators and industry groups have sued, arguing these markets should be treated as gambling.
Kalshi made most of its money in 2025 from sports contracts
Kalshi permits 18+ access and is legal in every state because it’s regulated federally. So young people in states that ban online sportsbooks or require participants to be at least 21 can still place wagers on sports.
That widens the player pool and shifts where gambling-like profits and risks accrue – federal regulation means Kalshi doesn’t pay state licensing fees or follow state age limits.
PMs blur the line between regulated gambling and investment platforms; sportsbooks and exchanges now offer overlapping products.
Financially, sports event contracts made up nearly 90% of Kalshi’s fee income in 2025, signaling heavy consumer interest. From a consumer-protection angle, fewer guardrails (lower age limits, limited state oversight, undisclosed proprietary trading) increase risks of problem gambling and raise questions about whether the platform effectively profits from customer losses.
Based on reporting by Emily Washburn for Daily Citizen.
