Kalshi CEO warns prediction markets could go offshore
Tarek Mansour says he feels “pretty good” about Kalshi’s legal position.
US.- Kalshi CEO Tarek Mansour has warned that prediction market operators could move their businesses outside the United States if courts uphold states’ authority to regulate their activities. Speaking at DC Fintech Week in Washington, he defended the company’s position amid the ongoing legal conflicts over whether event contracts fall under federal commodities law or state gambling rules.
Mansour argued that the dispute is not simply about choosing between state and federal regulation, but about whether prediction markets will be able to operate in the US at all. “It’s not a choice of state versus federal market. It’s a choice of whether prediction markets exist in the US or whether they go offshore,” he said, adding that he felt “pretty good” about Kalshi’s legal position despite setbacks in some courts.
Mansour also rejected allegations that trading volumes in Kalshi’s bitcoin and ether perpetual-futures markets had been inflated. He attributed recurring trade sizes highlighted on social media to fixed-size orders placed by market makers.
States argue that sports-related contracts amount to gambling and should be subject to their gaming laws. Kalshi and the Commodity Futures Trading Commission (CFTC) maintain that the latter has exclusive authority over such contracts. New Jersey has asked the US Supreme Court to review the issue.
The CFTC has taken steps to clarify its authority. Last week, it issued a rule and proposed another measure intended to classify certain event contracts as swaps subject to federal commodities law rather than state gambling regulation. Chairman Michael Selig said the action clarifies which products fall outside the commission’s oversight.
