Baltimore Sues Kalshi, Polymarket Over Sports Betting

Baltimore has filed lawsuits against prediction market operators Kalshi and Polymarket, accusing the companies of running illegal sports-betting platforms and misleading consumers about how their services are regulated.

Mayor Brandon Scott and the Baltimore City Council filed the lawsuits Thursday against both companies and their affiliates. City officials allege the platforms violate Baltimore’s Consumer Protection Ordinance by offering sports wagers without required licenses, CBS Baltimore reports

“These companies are running sportsbooks without licenses and betting that a new label will put them above the law,” Scott said in a statement.

Prediction markets allow users to trade on the outcomes of sporting events, elections and other events. Kalshi and Polymarket argue their products differ from traditional gambling because customers trade contracts against other users.

Baltimore’s lawsuits contend the companies effectively offer traditional sportsbook-style wagers, including bets on game winners, point spreads and player statistics. The city alleges that describing the wagers as “event contracts” or “prediction-market trades” allows the companies to avoid regulations, taxes and responsible-gambling requirements placed on licensed sportsbooks.

The city is seeking civil penalties and restitution for affected consumers.

Both companies disputed Baltimore’s allegations. Kalshi called the lawsuit “political theater” and said it operates legally under federal oversight. Polymarket argued prediction markets registered with the Commodity Futures Trading Commission are regulated by federal law rather than state or local governments.

Baltimore joins other jurisdictions challenging prediction-market operators as courts consider whether regulation of the rapidly growing industry belongs primarily with federal agencies or state and local governments.