Kalshi sues Missouri and Polymarket US sues Louisiana as October volume sets records, with about $65 billion traded on Kalshi
Kalshi took Missouri to federal court on 27 October over a cease-and-desist letter, Polymarket US sued Louisiana the same day, and OG.com sued Utah, a day after the CFTC did. Meanwhile Kalshi passed about $65 billion of October volume and Polymarket US about $10 billion, both records before the month was out. The four lawsuits, what each one argues, the state-by-state scorecard and the volume numbers.
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The fight between prediction markets and the states moved into three more courtrooms this week. On 27 October, Kalshi sued Missouri and Polymarket's US exchange sued Louisiana in federal court. A day earlier, the exchange behind OG.com sued Utah, on the same day as the CFTC and the Justice Department (our report on the federal suit). Kalshi had also filed a separate case against Louisiana on 23 October.
All of these suits make the same basic argument. Event contracts on a federally regulated exchange are governed by the Commodity Exchange Act and the CFTC, so state gambling laws cannot be used against them.
The legal pressure has not slowed trading. In figures reported by Coinpaper on 29 October, Kalshi had traded about $65 billion so far in October and Polymarket US about $10 billion. Both were monthly records with days of the month still to go.
Kalshi v. Missouri
| Court | U.S. District Court, Eastern District of Missouri |
| Case | No. 4:26-cv-01860, filed 27 October 2026 |
| Defendants | Attorney General Catherine Hanaway, the Missouri Gaming Commission, its executive director Michael Leara and its members |
| Claim | One claim: the Commodity Exchange Act preempts Missouri law under the Supremacy Clause |
The trigger was a 16 September cease-and-desist letter from Hanaway. As RG.org reported the complaint, the letter accused Kalshi of running an "unlicensed online sports wagering platform" in Missouri. It demanded that Kalshi stop, or else meet the state's licensing, tax, fee and age requirements. Missouri then gave Kalshi another 14 days to comply.
Kalshi says it will ask for a preliminary injunction. It will also seek a temporary restraining order if the state will not promise to hold off in the meantime.
Missouri has been busy. Hanaway sent similar letters to Polymarket, Underdog, Crypto.com, Robinhood and Novig, according to Gaming America, as cited by RG.org. Crypto.com and Novig had already sued Missouri earlier in October. The state launched its own legal sports betting on 1 December 2025, after voters approved it in 2024. That licensed regime is the one Missouri wants prediction markets to join.
Polymarket US v. Louisiana
| Plaintiff | QCX LLC, which does business as Polymarket US |
| Court | U.S. District Court, Eastern District of Louisiana |
| Case | No. 2:26-cv-02482, filed 27 October 2026 |
| Defendants | Attorney General Liz Murrill, members of the Louisiana Gaming Control Board, Gaming Division director Dawn Himel and board chairman Chris Hebert |
| Claims | Preemption by the Commodity Exchange Act, and a violation of the Commerce Clause |
Polymarket's suit goes back further than Missouri's. It points to a 5 December 2025 advisory notice in which the Gaming Control Board told the businesses it regulates that sports event contracts, and some other event contracts, are illegal gambling.
The complaint also argues that a Louisiana sports-betting licence is not a real option. The state has 20 licences, and they go first to in-state riverboat, racetrack and casino licensees. A licensed operation would also have to run from Louisiana and serve only people located there. That, Polymarket argues, cannot work for a national exchange.
Kalshi sued Louisiana's attorney general and the Gaming Control Board separately, in the Western District of Louisiana, on 23 October, according to court records cited by RG.org. The reports we have seen do not describe that complaint in detail.
OG.com v. Utah
The third new suit came from a much older exchange. North American Derivatives Exchange, which does business as OG.com Prediction Markets, has been a CFTC-designated contract market since 2004. It launched OG.com as a separate event-contracts platform in February 2026.
It sued Utah Attorney General Derek Brown and three of his deputies in the District of Utah on 26 October (No. 2:26-cv-01056, assigned to Judge David Barlow). It argues express, field and conflict preemption, the same three arguments the federal government makes in its own case.
Its trigger was Utah's 20 October state-court suit against Kalshi and two Susquehanna entities (our report). OG.com says that case shows Utah will take the same action against it. "Kalshi runs an online casino in Utah and calls it a prediction market. That violates Utah law," Brown said when Utah sued Kalshi.
The scorecard so far
Counting this week, the dispute now spans a long list of states, with exchanges suing states, states suing exchanges and the federal government suing states.
| State | What is happening |
|---|---|
| Utah | Utah sued Kalshi in state court (20 October); the CFTC and Justice Department sued Utah (26 October); OG.com sued Utah (26 October). A federal judge ruled for Utah in Kalshi's earlier case in August, and the Tenth Circuit refused Kalshi an emergency injunction on 8 September. |
| Missouri | Cease-and-desist letters in September; suits by Crypto.com and Novig (October) and Kalshi (27 October) |
| Louisiana | Suits by Kalshi (23 October) and Polymarket US (27 October) |
| Arizona, Minnesota, Illinois | The CFTC has won preliminary injunctions |
| Wisconsin | A judge found the CFTC had not shown it was likely to win |
| Kentucky, New York, Connecticut, New Mexico, Rhode Island | CFTC suits pending |
| Ohio | Polymarket US sued on 16 October, the day the state's deadline to stop offering sports contracts ran out (our report) |
The CFTC's complaint against Utah says it has already sued Arizona, Connecticut, Illinois, Kentucky, Minnesota, New Mexico, New York, Rhode Island and Wisconsin. Utah makes ten. The bigger question, whether federal law really pushes aside state gambling law for sports contracts, is moving toward the Supreme Court. New Jersey has already asked the justices to hear its case against Kalshi (our Supreme Court report), and the NFL filed a brief backing that request (NFL brief).
Volume keeps setting records
None of this has dented trading. Here are the October figures Coinpaper reported on 29 October, before the month closed.
Source: Coinpaper, 29 October 2026; month-to-date figures
- Kalshi: about $65 billion, already about 10% above its September record.
- Polymarket US: about $10 billion, roughly 15% above its previous best month.
- Open interest, the value of contracts still open, was at a record $2.05 billion on Kalshi and $384 million on Polymarket US.
Kalshi's growth over a year is the striking part. Its volume in October 2025 was about $4.4 billion, roughly level with Polymarket's international platform at the time. This October it is about 18.7 times Polymarket's international volume.
In The Block's comparison of Kalshi, Polymarket US and Polymarket's global exchange, Kalshi had nearly 83% of combined volume. The two US-regulated exchanges together had 95.6%. The Block also tracks prediction-market volume against spot crypto trading volume. That ratio rose to 11.42 in October from 7.34 in September, though it compares trading activity, not dollars of risk.
Source: The Block, via Coinpaper, 29 October 2026; Polymarket US share derived from the 95.6% combined US figure
Show the dataHide the data
| Value | |
|---|---|
| Kalshi | 83% |
| Polymarket US | 12.6% |
| Polymarket international | 4.4% |
Sports drive most of it, which is exactly what the states object to. The NBA's new partnership with both exchanges, signed on 26 October, adds official league data to the mix (NBA deal). The midterms on 3 November are the next test of whether politics can add another large source of volume. More than $1.4 billion had been traded on midterm markets by 23 October, CNN reported (midterm trading report).
Robinhood reported $173 million of prediction-market revenue in the third quarter, more than its $120 million from crypto trading, Coinpaper noted.
Why the states keep suing
The states' argument is simple: a contract that pays out on a football game is a sports bet, whoever lists it. If it is a bet, it needs a state licence, pays state taxes and follows state rules on age and advertising.
The exchanges, and now the CFTC, answer that these are swaps under federal law. Swaps on a designated exchange are the CFTC's alone to regulate. Fifty sets of state rules, the government's Utah complaint argues, would leave the industry facing "the prospect of 50 regulators across the country".
The courts have not settled it. Federal judges have split, as the scorecard shows, and so have the appeals courts that have ruled so far. For now the practical effect depends on the state. In some, exchanges keep operating under court protection. In others they face live enforcement threats.
What happens next
Most of these cases will turn first on preliminary injunctions: court orders that freeze things as they are until the case is decided. To get one, the party asking must show it is likely to win, that it would suffer harm that money cannot fix, and that the balance of hardships and the public interest favour it. That is why the early rulings matter so much. A state blocked by an injunction cannot enforce while the case runs, which can take a year or more.
- Missouri: watch for Kalshi's preliminary-injunction motion and whether the state agrees to hold off while it is decided.
- Louisiana: two federal cases, in two districts, on similar facts. They may be handled together or move at different speeds.
- Utah: three federal cases against the state, plus the state's own case against Kalshi. The federal government's request for a preliminary injunction is the one to watch.
- The Supreme Court: whether it takes up the preemption question is what would end the patchwork.
What it means if you trade
If you use Kalshi or Polymarket US, nothing changes from these filings alone. A lawsuit asks a court to stop a state from acting; it does not change what the exchange offers. Availability is set by each exchange, and it can change quickly if a court rules or a state acts. Our guides to whether Kalshi is legal and whether Polymarket is legal in the US explain the rules state by state, and we update them as rulings come in.
Key points
- Kalshi v. Missouri (E.D. Mo., 27 October) challenges a September cease-and-desist letter; Kalshi will seek a preliminary injunction.
- Polymarket US v. Louisiana (E.D. La., 27 October) challenges a December 2025 advisory calling sports event contracts illegal gambling. Kalshi filed its own Louisiana suit on 23 October.
- OG.com v. Utah (D. Utah, 26 October) joins the CFTC's suit filed the same day.
- Volume: about $65 billion on Kalshi and $10 billion on Polymarket US in October so far, both records. Kalshi has about 83% of combined volume.
- The underlying question, whether federal law overrides state gambling law, is heading toward the Supreme Court.
Related reading
- CFTC and the Justice Department sue Utah
- Utah sues Kalshi and Susquehanna
- Is Kalshi gambling?
- Who owns Kalshi? and who owns Polymarket?
- Prediction market news
This is news, not legal advice. Prediction markets are for adults where they are legal, so check the rules where you live.
