TLDR
- Nevada regulators say Kalshi missed an August 12 court deadline to block certain event contracts in the state.
- The Nevada Gaming Control Board wants $120,000 in daily fines plus legal fees.
- Investigators placed trades from inside Nevada a day after the deadline using an older version of the Kalshi app.
- Kalshi says investigators misrepresented their location and worked around its blocking system.
- Testing in Michigan found a similar gap tied to the same older app version.
Nevada gaming regulators and prediction market platform Kalshi are locked in a legal dispute over whether the company met a court-ordered deadline to stop offering certain bets in the state.
The fight centers on event contracts tied to sports, elections, and entertainment. A judge had ordered Kalshi to block these contracts for Nevada users by August 12.
On August 14, the Nevada Gaming Control Board told a Carson City court that Kalshi failed to meet that deadline. The board asked the court to impose fines of $120,000 for every day the company stays out of compliance, along with legal fees.
Investigators said they placed nine trades from inside Nevada the day after the deadline passed. They used mobile phones connected to Nevada cell networks to do it.
Kalshi disputes how those trades happened. The company says investigators misrepresented their residence and, in one case, worked around the restrictions meant to block them.
Kalshi and Nevada Trade Accusations
Kalshi’s general counsel, Rick Heaslip, said the company went “above and beyond” to meet the deadline. He said Kalshi hired a state-approved vendor and kept regulators updated throughout the process.
Heaslip also accused investigators of breaking federal law by giving false location information to access the app. He called the board’s actions a waste of taxpayer money.
The Nevada Gaming Control Board called Kalshi’s claims baseless. The board said Kalshi still missed the agreed deadline, regardless of how investigators gained access.
Nevada Attorney General Aaron Ford said Kalshi submitted its app update to the Apple and Android stores on August 9. He argued that left too little time for all users to download it before the August 12 cutoff.
Ford said app store updates can take up to a week to reach every user. He argued Kalshi should have planned for that delay.
Older App Version at Center of Dispute
Kalshi’s geofencing system was built with GeoComply, a Nevada-licensed location verification company. The company says the trades in question came from a prior version of its app that wasn’t covered by the new geofencing rules.
That explanation lines up with separate testing done in Michigan. Gaming outlet InGame found that Kalshi’s sports betting block only applies to users running the newest app version.
A reporter registered in Indiana placed sports trades from Michigan using an older app version. The app didn’t prompt the user to update, and the trades went through until the reporter manually installed the new version.
Once updated, the geolocation controls blocked further sports trades. The findings suggest the same app gap in Michigan may explain what happened in Nevada.
The legal dispute between Kalshi and Nevada goes back to March 2025, when the state issued a cease-and-desist letter over unlicensed sports betting. Kalshi sued, won a preliminary injunction, then saw it reversed months later.
Nevada has since secured a temporary restraining order and a new injunction against the contested contracts. Kalshi’s appeal is still pending before the Ninth Circuit.
A Nevada court will now decide whether Kalshi failed to properly implement its geofencing system, or whether investigators found a way around controls that were otherwise working as intended.
