Rhode Island’s attorney general sued Kalshi and Polymarket to block what he says are illegal “sports-related events contracts,” while Kalshi counters that the contracts fall under federal oversight by the CFTC.
Rhode Island has stepped into the growing fight over prediction markets—this time with a lawsuit aimed at the platforms themselves, and a swift reply from Kalshi.
Earlier this week, Rhode Island attorney general Peter Neronha filed opposing lawsuits against Kalshi and Polymarket. His argument is direct: the platforms are allegedly circumventing Rhode Island’s rules that allow sports gambling only through a singular state-sponsored platform.
Kalshi didn’t wait for the legal process to play out. The company filed its own lawsuit against Rhode Island, arguing that its event contracts—covering predictions of sports events and more—can only be regulated on a federal level by the US Commodity Futures Trading Commission (CFTC).
At the center of the dispute is the state’s push for a permanent, court-ordered ban. Neronha is seeking an order that would prevent Kalshi and Polymarket from offering “sports-related events contract” in Rhode Island.
In a press release, Neronha drew a line meant to collapse the distinction between legal and “real” gambling. “There is no substantive difference between sports betting and ‘events contract’ in this context,” he said. “Kalshi and Polymarket know that, and we know that.”
The lawsuits are confined to Rhode Island, but the stakes extend beyond the state lines. The case comes after earlier legal pressure in other places: Nevada and New Jersey sent cease-and-desist letters to prediction market platforms. only for those disputes to turn into similar legal battles. More recently. Minnesota passed a bill that includes a ban on prediction markets operating in the state—an action that is expected to be contested by the CFTC.
For Rhode Island, the question is whether the contracts can be treated as something other than sports betting under state law. For Kalshi and Polymarket, the pressure is whether their federal regulatory argument will hold—before a ruling in one state turns into a blueprint elsewhere.
Rhode Island Kalshi Polymarket prediction markets sports betting Commodity Futures Trading Commission CFTC Peter Neronha events contract legal battle
So they’re basically trying to ban Twitter-style betting but for sports? Wild.
I don’t get why Rhode Island can’t just let people bet if it’s not “actual” betting. Sounds like semantics to me. Also Kalshi says federal oversight but… whose rules win then?
Replying to Karen Johnson: Wait, didn’t they already ban gambling like years ago in RI? If so, why are they suing companies instead of just enforcing it. Feels like paperwork theater until CFTC steps in and ruins everything lol.
“No substantive difference” is such a cop-out line. But also, prediction markets ARE basically sports betting with extra steps, right? I’m just surprised this is only Rhode Island and not, like, everywhere already. If Minnesota is banning too then it seems like the states are gonna keep copying each other before the CFTC figures it out.