Kalshi secures a temporary halt in Arizona criminal proceedings

Legal proceedings against Kalshi in Arizona have been paused after federal regulators intervened in the case.

The Commodity Futures Trading Commission (CFTC) announced on Friday that it had secured a temporary restraining order blocking the state of Arizona from continuing its criminal prosecution against the company. The order effectively prevents the case from advancing while the legal dispute over jurisdiction is being examined.

In a statement, CFTC chairman Michael S. Selig criticised Arizona’s approach, saying, “Arizona’s decision to weaponise state criminal law against companies that comply with federal law sets a dangerous precedent, and the court’s order today sends a clear message that intimidation is not an acceptable tactic to circumvent federal law.”

The CFTC is typically composed of five commissioners. Still, Selig is currently the sole member following his confirmation in December and the departure of former acting chair Caroline Pham, who left to join crypto firm MoonPay. The legal conflict stems from charges brought by Kris Mayes, who has accused Kalshi of operating an unlicensed gambling business within the state. Arizona authorities argue that the platform’s activities violate state law, while Kalshi and federal regulators maintain that the company operates within a federally regulated framework.

The development comes shortly after a federal judge had allowed Arizona’s case to proceed, according to reports cited by Bloomberg. The restraining order now temporarily halts that momentum. In addition to the Arizona case, the CFTC has taken legal action to stop similar proceedings in other states, including Connecticut and Illinois, as it seeks to assert federal oversight over prediction-market matters.