New Mexico Files Lawsuit Against Kalshi Over Sports Markets

The Land of Enchanment is hoping to cast out Kalshi.

New Mexico Attorney General Raul Torrez has filed a lawsuit against the prediction markets leader. In it, he accuses the operator of knowingly offering online sports betting, which remains illegal in the state. He also cites Kalshi’s minimum age of 18, which is below the state’s 21 minimum for gambling. 

The lawsuit was filed in Santa Fe County’s 1st Judicial District Court.

Lawsuit Emphasizes Betting Age

The lawsuit filed in New Mexico resembles those filed in many other states over the last few months. The state claims its autonomy to regulate gambling is being circumvented by Kalshi, which has publicly advertised itself as offering legal sports betting in the past. It asks to court to force the operator to shut down its sports markets in the state.

Unlike other states, this lawsuit highlights concerns over the lower minimum age. It points out the danger this can create for young residents, especially with few problem gambling resources provided by prediction operators. Given the national concerns over underage gambling, this argument may resonate more with the public as the battle over prediction markets plays out.

Torrez Highlights Problem Gambling Concerns

A primary reason for lawmakers holding off on legalizing online sports betting is the ever-growing problem of the gambling crisis facing the US. Mobile betting drove those numbers up, and states have yet to find a reliable way to curb them. While retail betting is also a source of problem gambling, the need to place wagers in person provides a crucial barrier.

A press release from Torrez shared his belief that Kalshi is threatening to bring that crisis to New Mexico.

New Mexico has a longstanding and carefully balanced system for regulating gaming that protects consumers, ensures accountability, and respects tribal sovereignty. The only lawful gaming in New Mexico operates either under tribal-state gaming compacts or under strict state regulations to ensure honest gaming free from corruption, and licenses gaming operators only after they explain how they plan to address compulsive gambling. Kalshi has ignored that framework entirely while offering online sports betting within the state. We are filing this lawsuit to protect the integrity of our laws, our regulatory system, and most importantly, consumers.

How Much More Can Kalshi Take?

Kalshi has largely refused to apologize for or address concerns about its sports markets, and this has led to a never-ending parade of lawsuits. They have been taken to court by over 15 states, along with several tribal gaming groups. While the operator isn’t short on cash, there is reason to wonder how much longer they can keep their fight up.

Despite rapidly rising operating costs, Kalshi has plenty of incentive to keep up the fight. 

One significant reason is the support from President Trump and his cabinet, which provides critical federal assistance despite pushback from the states. The lawsuits are also likely to be ultimately decided by the US Supreme Court, whose conservative majority has largely supported the President.

Another reason is the revenue generated by sports markets. Kalshi offers markets across a number of industries and events, but its biggest earners involve sports markets. If they are forced to abandon or severely restrict them, it would have devastating financial consequences.