Baltimore Takes Kalshi and Polymarket to Court Over Sports Contracts

Baltimore has filed lawsuits against Kalshi and Polymarket, accusing both companies of operating illegal sports wagering platforms without the licences required under Maryland law.

The lawsuits, filed by Mayor Brandon Scott and the City of Baltimore, allege that the two prediction market operators have violated the city's Consumer Protection Ordinance by offering sports event contracts that officials say function as unlicensed sports betting products. Baltimore is also seeking to stop the companies from continuing to offer those contracts to local residents.

City Expands Its Gambling Enforcement Efforts

The legal action marks the latest step in Baltimore's campaign against online gambling operators.

Over the past two years, the city has filed similar lawsuits against major sportsbooks and sweepstakes casino operators. By adding Kalshi and Polymarket to that list, Baltimore has become the first U.S. city to take direct legal action against prediction market platforms.

The complaint against Kalshi also names Robinhood, Webull and Coinbase, which provide access to Kalshi's event contracts through their respective platforms.

Another Legal Test for Prediction Markets

Baltimore argues that sports event contracts offered by Kalshi and Polymarket should be treated as sports wagering under Maryland law rather than federally regulated financial products.

That position builds on similar arguments made by several state regulators over the past year, as the legal debate surrounding prediction markets continues to grow. Operators, meanwhile, maintain that their contracts fall under the oversight of the Commodity Futures Trading Commission (CFTC) and are governed by federal commodities law rather than state gambling regulations.

Pressure Continues to Build

The Baltimore lawsuits add to a growing list of legal challenges facing the prediction market industry across the United States.

With courts and regulators continuing to examine how sports event contracts should be classified, the outcome of these cases is expected to play a significant role in shaping the future of prediction markets. Baltimore's decision to pursue legal action also shows that scrutiny is no longer limited to state regulators, with local governments now taking a more active role in the debate.

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