Nevada Regulators Seek Contempt Ruling Against Kalshi Over Geofencing Lapses

Nevada’s Gaming Control Board has asked a state court to hold prediction market operator Kalshi in contempt, accusing the company of ignoring a judicial order that barred it from offering sports betting in the state.

The filing, made Friday with the First Judicial District Court, claims Kalshi continues to take in hundreds of millions of dollars in wagers tied to major sporting events, including the NBA Finals, the Stanley Cup Finals, and the FIFA World Cup.

At the center of the whole dispute is geofencing, with regulators stating that Kalshi failed to block access to its platform for Nevada residents, despite a May 18 injunction requiring that “it does not offer or facilitate the offering of any sports-, election-, or entertainment-related event contracts” within the state.

The Board’s filing was clear: “Kalshi’s stubborn refusal to comply with the preliminary injunction is causing severe and ongoing harm to Nevada, its finances, and its citizens. Every day, Kalshi takes in hundreds of millions in wagers on such events as the NBA Finals, the Stanley Cup Finals and FIFA World Cup.”

“At the same time, Kalshi is severely harming the gaming industry because it refuses to follow the same rules as its licensed sportsbook competitors who actually geofence. This is an intolerable state of affairs. In light of the Board’s investigation and Kalshi’s own admissions that establish its violation of the court order, the court shall hold Kalshi in contempt. Kalshi will never get the message otherwise.”

The NGCB wants $120k/day penalty

The NGCB has asked the court to impose heavy financial sanctions on Kalshi, arguing that only strict penalties will force the operator to comply with state law.

In its filing, the Board requested either a full disgorgement of profits or a daily fine of $120,000 for continuing to offer prohibited event contracts in Nevada.

Dreitzer highlighted the seriousness of the matter, stating, “The court has required Kalshi to stop offering covered event contracts in Nevada. We will continue to vigorously enforce Nevada law to safeguard gaming in our state.”

Investigators revealed that Kalshi admitted to spending $190,000 on what regulators described as a “homegrown solution” that relied solely on IP‑based geofencing. The Board dismissed this approach as “notoriously unreliable” and accused the company of refusing to adopt proven commercial geolocation tools.

The filing went further, saying: “This is just more from the same old Kalshi playbook; delay, delay, delay. Rather than comply with the court’s order Kalshi has taken only a half-hearted and ineffective measure, apparently hoping that the court will deem its meager efforts good enough, so that it can continue profiting at the expense of the state and its citizens.”

Investigators were able to purchase contracts despite geoblocks

Despite Kalshi’s claims of geofencing, Nevada regulators said their investigators were able to buy sports betting contracts through the company’s app. These included wagers on NBA playoff games, MLB contests, a boxing bout, a tennis match, and even a celebrity wedding.

The findings, according to the Board, show that Kalshi continues to operate in violation of the injunction. Dreitzer explained why the regulator views this as a serious breach, noting that the state considers sports event contracts and similar offerings to be wagering activity under Nevada law.

That means they must be licensed. “Nevada’s public policy, as expressed by the Legislature, is that the gaming industry is vitally important to the economy of the state and the general welfare of the inhabitants and therefore must be licensed, controlled, and assisted to protect the public health, safety, morals, good order, and general welfare of the inhabitants of the state,” Dreitzer said.

The Board pointed out that it has already taken steps in recent months to shut down other unlicensed prediction markets in Nevada.

Source: CDC Gaming

Nevada Regulators Seek Contempt Ruling Against Kalshi Over Geofencing Lapses

The NGCB wants $120k/day penalty

Investigators were able to purchase contracts despite geoblocks

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