Betting on Trouble: New York Takes on Kalshi

New York State’s lawsuit against Kalshi is raising a much larger question than whether the prediction-market platform constitutes an illegal gambling operation: Who gets to control, and profit from, America’s rapidly expanding betting industry?

South Shore Press Managing Editor Stefan Mychajliw, guest hosting on NewsRadio 930 WBEN, discussed the legal battle with South Shore Press Sports Director and nationally known sports-betting expert Tom Barton.

Stefan Mychajliw: New York State is suing Kalshi, and that’s what they’re calling it, an illegal gambling operation. Who better to talk about this than nationally known sports betting expert Tom Barton?

Tom Barton: I’m doing fantastic. I’m doing better than Kalshi, who’s sitting in court somewhere, right?

Mychajliw: Walk us through exactly what this is about, with Letitia James, the New York State attorney general, trying to shut down Kalshi in New York.

Barton: For layman’s terms, and to really bring it down to the basic number, it’s simply who is going to control betting markets. That’s it. This is what this comes down to.

At the end of the day, it’s a fight over who will regulate the betting markets. This is a prediction market, and they’re saying that’s a betting market. And it is.

The people that Kalshi has annoyed, we’ll say, are major regulated sports casinos. They are going, “Wait a minute. We had to go through so many hoops just to apply.”

It was millions and millions of dollars. It’s a billion-dollar industry, and places that are prediction markets, like Polymarket and Kalshi, kind of circumvent the law.

Mychajliw: What happens next? The New York State Attorney General is filing suit. They’re going to battle it out in court.

Barton: This is going to be monumental because right now they are banned in Nevada. Las Vegas, you can’t go out there and bet prediction markets. Other states will follow. They’re all going to watch and see what happens here.

I don’t think they’re going to get shut down. I think what happens here is that it’s going to either be state by state or, hopefully, like you and I talked about, a federally governed situation where you’re watching them.

We’re going to find ways to bet, whether it be legally or illegally, whether it be Polymarket, Kalshi or 'Broken Nose Tony' on the corner. You’re going to find a way to do it, but they want to have some kind of regulations.

Mychajliw: Broken Nose Tony on the corner. That’s hilarious.

Barton: I turned 49 years old two weeks ago, and I’ve been betting for about 35 years of that, and it’s only been legal for 10. You will find ways around legalized betting, but they want to have some kind of control.

Mychajliw: The established casinos and sports-betting apps would be behind the actions New York State is taking because they view Kalshi and Polymarket as competitors?

Barton: Not only would they be behind it; I think they are behind it. If you peel back that onion so many layers, I think at the bottom is a lot of money coming from legalized sports betting saying, “You better shut these guys down. They’re cutting into our market.”