The prediction market platform Kalshi stormed onto the political scene in 2024, when it went toe-to-toe with the Biden administration and won the right to offer contracts on the outcome of elections.
But in the two years since then, Kalshi’s legal woes have accumulated.
Complaints of insider trading have abounded, with the White House even firing one of its own teleprompter operators after Kalshi said he was using his advance knowledge of speeches to make bets on what President Trump would say.
Now Kalshi faces lawsuits in New York and California, which accuse the firm of wrongly sharing users’ personal information and activities with the likes of Google, TikTok and LinkedIn.
A user’s trading and wagering information can reveal a person’s risk-taking, interests and level of engagement involving topics ranging from politics, sports, social controversies, real-world events and financial markets, the lawsuits allege.
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“Despite the sensitive nature of the information collected through its Digital Platforms, Kalshi installed and permitted third-party scripts, pixels, and tracking technologies to operate on the platforms,” reads one complaint, filed in a federal court in Manhattan.
The other lawsuit was filed in a federal court in Southern California.
Kalshi has yet to file formal responses to the complaints. The firm didn’t respond to “Seen, Heard & Whispered“’s inquiry.
Separately, New York Attorney General Leticia James sued late last month to try to shut down Kalshi, calling it an illegal gambling operation.
But Kalshi has a major supporter in the Trump administration and Michael S. Selig, chairman of the Commodity Futures Trading Commission, who has told states to stop the lawsuits. He argues that if the U.S. cedes the ground, foreign operators will take over, with fewer protections for Americans.
