Kalshi board member: New York lawsuit aims to shut down prediction markets entirely

Summary

Kalshi board member Brian Quintenz discusses New York's lawsuit against the prediction market platform, calling it lawfare aimed at shutting down prediction markets. He argues that prediction markets are federally regulated exchanges under the Commodity Exchange Act, distinct from state-regulated gambling, and expects the legal battle to reach the Supreme Court, where federal preemption will be upheld. The discussion also covers the exchange model versus casino odds-making, and ongoing opposition from multiple states.

• New York AG sues Kalshi, alleging an illegal gambling operation.
• Brian Quintenz calls the lawsuit egregious lawfare designed to shut down all prediction markets.
• He distinguishes Kalshi’s exchange model (federally regulated) from casino gambling (state regulated).
• Quintenz argues that federal regulation over federally registered markets preempts state laws.
• He expects cases to consolidate and reach the Supreme Court, ultimately favoring federal preemption.
• Prediction markets provide utility through pricing information and hedging opportunities.
• Pushback from Massachusetts, Washington, and Michigan is seen as a state-level patchwork that must be resolved.
• Disclosure: CNBC and Kalshi have a commercial relationship including customer acquisition and a minority investment.