The Nevada Gaming Control Board has moved to hold KalshiEx LLC in contempt of court, alleging the CFTC-regulated prediction market operator failed to comply with geofencing obligations imposed by a state court injunction barring its sports-, election-, and entertainment-related contracts from Nevada residents. The contempt filing represents a procedural escalation beyond the injunction itself, shifting the dispute from whether Kalshi must comply to whether it already has.
The underlying order dates to March 20, 2026, when First Judicial District Court Judge Jason D. Woodbury issued a temporary restraining order prohibiting KalshiEx from offering or facilitating event contracts that Nevada regulators characterise as a “sports pool” and “percentage game” under state law – classifications that render them unlicensed gaming. That TRO was converted into a preliminary injunction on April 3, 2026, cementing the geofencing requirement as a binding court obligation while the merits of the case proceed. The NGCB’s contempt motion alleges Kalshi did not implement adequate geolocation controls to prevent Nevada-based users from accessing the restricted markets.
Nevada’s legal argument tracks the position it has advanced throughout the litigation: that CFTC designation as a designated contract market does not preempt state gaming law, and that Kalshi’s event contracts fall squarely within Nevada’s Gaming Control Act regardless of their federal regulatory status. The NGCB has pointed to a prior Nevada federal court decision rejecting Crypto.com’s preemption claim as confirmation that federal commodities oversight does not displace state authority over what Nevada defines as gaming activity. Kalshi, for its part, has consistently maintained that its CFTC-regulated contracts are lawful nationwide and has pursued parallel federal avenues, including an emergency stay motion before the Ninth Circuit that was denied – a denial that, by removing that procedural buffer, appears to have directly accelerated Nevada’s move toward contempt.
Mike Dreitzer, Gaming Control Board Chairman, said: “We are very pleased with Judge Woodbury’s ruling and will continue to vigorously enforce Nevada law to safeguard gaming in our state.”
The contempt filing marks a meaningful escalation in Nevada’s campaign against unregistered prediction market operators. The NGCB secured a preliminary injunction against QCX LLC, doing business as Polymarket US, on comparable grounds earlier this year, establishing that Nevada courts are willing to treat event contracts as gaming products subject to state oversight. The progression from injunction to contempt motion – a step that introduces potential sanctions, fines, and judicially compelled compliance measures – signals that the NGCB intends to use the full toolkit of civil enforcement rather than treat geofencing as a soft obligation.
The stakes extend well beyond Nevada. The Ninth Circuit has consolidated appeals involving Kalshi, Crypto.com, Robinhood Derivatives, and a California tribal operator, making the circuit a definitive battleground over federal preemption in this space. New Mexico’s Attorney General filed a separate suit against Kalshi in June, alleging illegal sports betting under a 1953 statute, adding to the multi-state enforcement picture. On the legislative side, draft federal legislation introduced in late March by Senators Adam Schiff and John Curtin would bar CFTC-regulated platforms from listing sports-related contracts entirely, citing the Nevada proceedings as part of its rationale.
The Nevada state court must now determine whether Kalshi’s geofencing measures were materially deficient and, if so, what sanctions are warranted. Observers are watching whether Kalshi mounts an emergency application to the U.S. Supreme Court if the contempt posture threatens a prolonged operational shutdown in the state, a move that would force federal judicial resolution of the preemption question before the Ninth Circuit concludes its own merits review.
Petra Vanhoof has spent the better part of a decade following the shifting tides of gambling regulation across Europe and beyond. She came up through the compliance side of the industry before pivoting to writing, which gives her a grounded, no-nonsense perspective on the rules, loopholes, and political maneuvering that shape how operators actually do business. She is particularly drawn to the gap between what regulators say and what the market ends up doing in response. Her coverage tends to focus on licensing developments, responsible gambling frameworks, and the ongoing tension between innovation and oversight. She has a sharp eye for the kind of regulatory language that sounds meaningful but leaves operators plenty of room to maneuver, and she enjoys pulling that apart for readers who want the real picture rather than the press release version. Petra is based in the Netherlands and writes with a continental European perspective that she thinks is often missing from English-language gambling coverage. Outside of work she is an avid cyclist and a reluctant but committed amateur poker player who insists the two hobbies have taught her the same lesson: patience matters more than instinct.