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New York Attorney General Letitia James has asked a Manhattan state court to permanently block Kalshi from offering what the state alleges is unlicensed sports wagering to New Yorkers. The petition also seeks to force Kalshi to identify affected customers and provide an accounting of their wagers, losses, and the company’s gains.
If granted, the request could expose New York customer betting data and add financial penalties on top of any order barring the platform from operating in the state.
What New York is asking the court to do
According to the July 31 petition, New York wants the court to require Kalshi to turn over the names of affected customers and itemize wagers and losses tied to its New York business. The state is also seeking restitution, damages, disgorgement, prejudgment interest, costs, and a penalty equal to three times alleged gains plus $100,000 per unauthorized offer.
The filing was brought under Executive Law Section 63(12) and advances eight legal theories. The state says Kalshi’s offerings violate New York’s constitutional prohibition on gambling, multiple Penal Law and Racing Law provisions, and the federal Wire Act.
The petition cites Kalshi’s self-reported $22 billion valuation and $178 billion annualized transaction volume from the company’s May fundraising announcement.
Case follows earlier enforcement fight
The latest filing comes after the New York State Gaming Commission sent Kalshi a cease-and-desist demand in October 2025 over alleged unlicensed mobile sports wagering.
Kalshi then sued state officials in federal court, arguing that its status as a federally regulated exchange preempts state gambling enforcement. But on July 7, the U.S. District Court for the Southern District of New York denied Kalshi’s request for temporary and preliminary protection from state action.
Kalshi spokesperson Elisabeth Diana called New York’s lawsuit “political theater” and said states cannot shut down a federally licensed exchange.
What New York players should watch
The key near-term question is whether the Manhattan court will grant New York’s request for a permanent injunction and an accounting of customer activity. That could determine not only whether Kalshi can continue serving New Yorkers, but also whether the company must disclose customer identities, wagers, and losses as the case moves forward.
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Source: As reported by cryptorank.io.
