Baltimore sues Kalshi and Polymarket for offering unlicensed sports betting

Key Points:

• Baltimore is suing prediction market platforms Kalshi and Polymarket for offering sports betting without a license, accusing them of competing unfairly with regulated sportsbooks by avoiding oversight, taxation, and responsible gambling requirements.
• The lawsuit highlights ongoing tensions between state/local governments and prediction markets, which are theoretically regulated at the federal level, creating regulatory uncertainty.
• Leading sportsbooks like DraftKings and FanDuel are increasingly pivoting to prediction markets to grow their customer base in states where sports betting remains illegal, amid declining sportsbook revenues.
• Prediction markets operate nationwide with a lower minimum age of 18, raising concerns about younger, inexperienced individuals being drawn into risky betting behaviors without sufficient protections.
• The issue of regulating prediction markets is expected to persist until the Supreme Court provides a definitive ruling, as current inadequate regulation fuels aggressive advertising and promotion across multiple media platforms.