Financial technology company Kalshi says it will increase user guardrails on its platform amid concerns expressed by MLB and other critics about its sports event futures. Kalshi’s maneuver also comes ahead of a previously extended deadline to respond to a cease-and-desist order from Nevada.
The company, currently overseen by the federal Commodity Futures Trading Commission (CFTC) rather than states, said the safety measures are unrelated to regulatory actions.
There are three initial aspects of Kalshi’s planned “customer protection hub”: voluntary opt-outs, self-imposed trading breaks and self-imposed caps on deposits—similar to what sportsbooks such as FanDuel and DraftKings are legally mandated to offer in many places.
Additionally, Kalshi is working with gaming technology provider Integrity Compliance 360 to implement suspicious activity monitoring and preemptive bans of individuals with insider information, such as athletes and coaches.
Kalshi does not plan to increase its platform’s age minimum from 18 to 21, a company official said.
On March 7, MLB wrote in a letter to the CFTC that Kalshi and similar firms did not have necessary internal protections to prevent insider trading that could undermine its sporting integrity.
“As the resemblance between sports event contracts and traditional sports betting markets continues to grow, so too does the need to replicate the integrity and consumer protections that exist at the state level,” MLB wrote to the CFTC in a letter signed by Bryan Seeley, the league’s executive vice president of legal and operations.
The CFTC will hold a late-April roundtable about its futures trading policy under the Donald Trump administration. Recent public statements and personal connections with futures trading providers suggest the agency will not crack down, instead taking a more hands-off approach. Notably, Trump’s son Donald Trump Jr. is an advisor to Kalshi, while the president’s nominee for CFTC chairman, Brian Quintenz, is a Kalshi board member.
On March 4, Kalshi received state-level legal pushback from Nevada, opening a new front in its battle to maintain operation in all 50 states. Nevada demanded Kalshi take down its contract futures trading platform, alleging it to be an illegal unregistered gambling operation, which the company has denied. The company did not promise it would comply, however, and it put out a statement on social media decrying the regulatory hurdles it has faced since its inception.
The Nevada Gaming Control Board granted a “limited” extension to its March 14 cease-and-desist order deadline for Kalshi to stop operating in the state, according to an email from Michael Lawton, a senior economic analyst at the agency. A Kalshi official said the new deadline is this Friday.
Kalshi continues to offer sports-related contracts in the state, including ones on 2025 March Madness results.
A Kalshi official said there was no ulterior motive behind this week’s introduction of user protection tools, which were formulated internally rather than by consulting a third-party advocacy group.
“The corporate strategy aspect and the protecting users aspect are essentially one and the same,” a Kalshi official wrote in an email. “We are rolling out the customer protection hub to make sure all of our traders have every possible customer safety feature available to them—and this is a key part of our corporate strategy.”
(This story has removed a paragraph to correct the number of states Robinhood is offering sports events futures in, as an official said it has not launched in Nevada.)
