Seventeen States Are Fighting Kalshi in Court — But Their Congress Members Took $89,000 From Kalshi Insiders

More than 17 US states are engaged in active legal battles against prediction market platform Kalshi or its federal regulator, the Commodity Futures Trading Commission. But new research from InGame, drawing on Federal Election Commission records, reveals a notable contradiction: sitting members of Congress from at least nine of those same states accepted more than $89,000 in campaign contributions from individuals employed by Kalshi between January 2025 and March 2026. The findings illuminate the growing political operation Kalshi and its founders have built in Washington even as state-level opposition reaches a peak.

Kalshi is a federally licensed prediction market that allows users to trade contracts on real-world outcomes, including sports events. Its sports event products have triggered a legal dispute with multiple states that argue the contracts are effectively sports betting products requiring state licensure. The CFTC under the Trump administration has backed Kalshi’s position that the products are commodity futures regulated at the federal level. Rhode Island, which both sued Kalshi in state court and was sued by Kalshi in federal court in May 2026, is among the states where the contradiction between state legal action and federal-level political contributions is most visible.

Political Money in the Prediction Market Fight

Kalshi co-founders Tarek Mansour and Luana Lopes Lara have built relationships with senior White House officials, and President Trump in May 2026 publicly called prediction markets a “new form of financial market” while endorsing the CFTC as the proper regulatory body. The company’s political investment strategy has been to cultivate federal-level influence, and the FEC contribution data suggests that strategy has extended to lawmakers whose home states are simultaneously fighting the company in court.

For sports bettors in states that currently have licensed and regulated markets, the Kalshi litigation has direct implications. States argue that allowing federally licensed prediction market platforms to operate without state oversight drains tax revenue and undermines consumer protection standards that took years to build after the Supreme Court struck down the federal sports betting ban in 2018. Tennessee passed legislation in 2026 specifically banning prediction markets and creating criminal penalties for manipulation of event contract markets.

Where Sports Bettors Stand

For anyone navigating this landscape, the key question is whether the federal courts will ultimately side with Kalshi and the CFTC or whether state authority to regulate prediction market products will be upheld. The answer will likely determine whether prediction markets become a mainstream alternative to traditional sports betting or remain a legally contested gray area. If courts rule in Kalshi’s favor, residents of states like Illinois, Ohio, and New Jersey could see prediction markets operating freely alongside their licensed sportsbooks. If states prevail, prediction market access could become patchwork, with some states permitting the products and others blocking them. Either way, the money flowing from Kalshi to elected officials in opposing states will remain a striking feature of one of the most unusual regulatory fights in the history of American sports gambling.