Kalshi calls New York Times sports betting comparison false

In a formal letter published on its website, Kalshi took direct aim at The New York Times, accusing the paper of ignoring answers that contradicted what the company called a predetermined narrative. The specific objection was to the Times describing Kalshi's sports event contracts as virtually indistinguishable from traditional sports betting. Kalshi called that characterisation flat out wrong.

The rebuttal landed at a peculiar moment. A unanimous Ninth Circuit panel had just ruled against Kalshi on precisely the question the Times raised — whether Nevada's gaming regulators could oversee those same contracts. The court found Kalshi had not demonstrated that the Commodity Exchange Act pre-empts state gaming law as applied to sports event contracts. Nevada Gaming Control Board Chairman Mike Dreitzer described the ruling as complete vindication. Kalshi's spokeswoman Dani Lever said the company would seek further review.

What makes the company's public letter interesting is not the argument it makes but the audience it has chosen. Forty-four state attorneys general have already written to the CFTC arguing that prediction markets have evaded state regulation and failed to pay state taxes. Twenty states are in active litigation. The Ninth Circuit just declined to stop Nevada from enforcing its laws. Publishing a rebuttal to a newspaper under those conditions is not a legal strategy — it is a positioning exercise. Kalshi is trying to hold the federal regulatory frame in public discourse while the courts hollow it out case by case.

On the tax question, Kalshi has a defensible point. Federally regulated companies do pay state taxes through the standard corporate structure. The states' letter conflated licensing fees and dedicated gaming tax revenue with general tax liability, and that is a meaningful distinction. I have seen companies lose the public argument on a technically correct position before, and Kalshi is at risk of doing exactly that. Being right on a narrow point while losing the broader characterisation is not a win.

The deeper problem for Kalshi is that it is now fighting a four-front war simultaneously — state litigation, federal insider trading investigations the Wall Street Journal reports are expanding to earnings contracts, a CFTC rulemaking process that has not resolved, and a Supreme Court petition that has not been granted. Each front individually might be manageable. Together they create a pressure profile that has historically preceded regulatory settlement rather than outright legal victory, in my experience of watching companies navigate exactly this kind of compounding exposure.

Lever's statement after the Ninth Circuit ruling contained one sentence worth reading carefully. She noted the court agreed with the Third Circuit that federal law prevents states from regulating trading on a federally licensed exchange — framing the loss as a partial win on a subsidiary point. That is technically accurate and strategically revealing. Kalshi's remaining leverage runs through the CFTC rulemaking, not the courts. The company knows this. The letter to the Times is a holding action while that process plays out.