A Look Inside The Cease & Desist Nevada Sent To Kalshi
TCL obtained the letter that the prediction market platform received from state regulators. Plus today's gambling news roundup includes earnings for FanDuel parent Flutter, and DraftKings' CEO speaks
Here’s the letter Nevada regulators sent to the prediction markets platform Kalshi that TCL obtained:
The TL;DR version:
The letter was sent on Tuesday to Kalshi CEO Tarek Mansour and Chief Regulatory Officer and General Counsel Eliezer Mishory.
The Nevada Gaming Control Board worked in concert with the Gaming Division of the Nevada Office of the Attorney General.
Kalshi is referred to the senior deputy attorney general in the state for questions regarding the C&D.
The letter specifically lays out violations of Nevada state law:
“Therefore, by offering event-based contracts in Nevada, Kalshi is operating as an unlicensed sports pool in violation of NRS 463.160(1)(a) and NRS 463.245(2). Pursuant to NRS 463.360(3), violation of NRS 463.160 is a category B felony. Kalshi's event-based contracts also violate NRS 465.086 and NRS 465.092. Additionally, even if Kalshi were to possess a Nevada nonrestricted gaming license with sports pool approval, the company's offering of event-based contracts on election outcomes would still violate Nevada public policy. Specifically, Nevada Gaming Commission Regulation 22.1205(3) and NRS 293.830 would be violated by wagering on election outcomes.”
No mention is made of the intersection of Nevada state law and Kalshi’s operation of prediction markets nationwide under the auspices of the Commodity Futures Trading Commission.
The letter seems to make it quite clear that the state intends to enforce the C&D if Kalshi doesn’t comply. Whether Nevada follows through in that event is of course an unknown.
Editor’s note: If you pass this off as your own reporting without tracking it down yourself, may your house be visited by a thousand plagues. But by all means go get it yourself!
Mansour also posted on LinkedIn about the C&D, although said little of substance about what Kalshi will do next or what its response in Nevada will be. Here’s one part of what he wrote:
After the election, we were convinced that the value of prediction markets was now obvious to everyone, and that the regulatory battle for legal prediction markets was over… We were right, except for the everyone part.
I am not exactly sure what he thought would happen when Kalshi started offering full-blown sports betting in 50 states… that everyone would throw them a parade? If Kalshi had stuck with elections and other stuff, gaming regulators (Nevada included) and others might not have loved it but may not have stuck their nose into Kalshi’s business.
More background, my initial newser at The Event Horizon; analysis plus Kalshi’s official statement at TCL overnight.
The podcast will be back next week!
Join us at the 𝗡𝗘𝗫𝗧.𝗶𝗼 𝗦𝗼𝗰𝗶𝗮𝗹 𝗖𝗮𝘀𝗶𝗻𝗼 𝗦𝘂𝗺𝗺𝗶𝘁 𝟮𝟬𝟮𝟱, proudly headlined by Alea, a leader in the gaming innovation space.
On March 11, 2025, this half-day summit brings together the brightest minds in gaming to explore:
✅ 𝗢𝗽𝗽𝗼𝗿𝘁𝘂𝗻𝗶𝘁𝗶𝗲𝘀 𝗮𝗻𝗱 𝗰𝗵𝗮𝗹𝗹𝗲𝗻𝗴𝗲𝘀 in social casino and promotional gaming.
✅ How to navigate 𝗿𝗲𝗴𝘂𝗹𝗮𝘁𝗼𝗿𝘆 𝗹𝗮𝗻𝗱𝘀𝗰𝗮𝗽𝗲𝘀 and build sustainable models.
✅ Innovative strategies for creating 𝗹𝗼𝗻𝗴-𝘁𝗲𝗿𝗺 𝘀𝘂𝗰𝗰𝗲𝘀𝘀 in the sector.
📍 𝗪𝗵𝗲𝗿𝗲: Convene at Brookfield Place, 225 Liberty St, NYC
🔗 Learn more and secure your ticket now.
Gambling news roundup
Flutter touts growth, particularly in US despite tough NFL season (iGB): “Flutter executives shared that fourth-quarter revenue increased 14% and fiscal year revenue was up 19%, mostly on the back of US sports betting and iCasino. Executives also reported that for FanDuel in the US, the number of average monthly players grew 7% in the quarter and 13% for the fiscal year. Overall, the tone was enthusiastic as Flutter reported growth across the world during its fourth-quarter earnings call on Tuesday.”
DraftKings CEO speaks at Morgan Stanley event: You can listen to the whole webcast here, but a few interesting nuggets I heard from CEO Jason Robins:
“So on the existing state side, we said by 2028, we believe we could get to $2.1 billion in EBITDA. And I think right now, we feel like we are ahead of schedule in terms of the growth. So if you look at the revenue piece, we're about a year ahead of where we projected we were.”
“…So far, we have seen really — benefit or hurting — no real material relationship between hold rate and handle.”
“So close to half, around half of our volume now comes from live betting and sports. And we've studied it quite a bit. We have a lot of data now for that reason. We've seen virtually zero evidence that it's cannibalistic. … So our conclusion is that we expect it to be almost entirely incremental, if not entirely incremental.”
“Well, I don't think there's a single part of our business that won't be affected and benefit from AI. So it's an organization-wide effort. Everyone is looking at how it can benefit what they do. I think some of the particular areas where we found early success are engineering – right now, we're seeing low double-digit percentage of our code being written through AI, and that will only go up. So as you can imagine, that has the ability to really significantly increase output and productivity in software shipping.”
“So we recently completed our inaugural debt offering. It was a term loan B, ended up being 5x or 6x oversubscribed and ended up upsizing a little bit, which we'll consider how we want to use maybe if we see the right opportunity, we could potentially accelerate some of the buybacks. So that's something we're considering and talking about now. But really, it was more about getting our feet wet in the debt markets, getting lenders used to sort of us and getting them comfortable with us. And we were very pleased, very pleasantly surprised in many ways with the reception we got.”
It’s also interesting Robins spoke extensively about Jackpocket without talking at all about how it had to exit Texas, its largest state for online lottery sales.
DraftKings Renews State Council Funding Program and Expands Responsible Gaming Initiatives (PR): “This Problem Gambling Awareness Month, DraftKings Inc. is reinforcing its commitment to Responsible Gaming through a series of initiatives and key milestones. The company is renewing its State Council Funding Program to further support nationwide resources, marking the one-year anniversary of its industry-first My Stat Sheet tool, and launching a national Responsible Gaming focused advertising campaign to raise awareness for responsible play. ‘At DraftKings, Responsible Gaming is fundamental to our mission, and we are committed to making tools, resources, and education available to all our players to help them play responsibly,’ said Lori Kalani, Chief Responsible Gaming Officer at DraftKings. ‘Through initiatives like My Stat Sheet, which provides players with their personalized play data, and our new national awareness campaign, we’re reinforcing the importance of responsible play. Additionally, with the renewal of our State Council Funding Program, we’re continuing to support organizations that expand access to resources and education for players, their families, and communities.’”
YouTube cracks down on gambling videos trying to lure viewers to unapproved sites (CNN): “The platform announced Tuesday it will no longer allow content that directs users to ‘unapproved’ gambling websites through links, images, text, logos or verbal references. YouTube defines unapproved gambling sites as those that don’t meet local legal requirements and haven’t been reviewed by YouTube or parent company Google. The update builds on YouTube’s existing policy prohibiting linking to external sites that violate its rules, including unapproved gambling sites. ’We’ve strengthened our policies that prohibit content directing viewers to unapproved gambling websites or applications,’ YouTube spokesperson Boot Bullwinkle told CNN exclusively ahead of the Tuesday announcement. ‘We will also begin age-restricting content that promotes online casinos.’
This is an interesting development, but the key is if YouTube is truly willing and able to enforce content moderation on this front.
Despite ‘ban,’ two lottery couriers still operating in Texas (KXAN): “During Tuesday’s Lottery Commission meeting, new rules to prevent courier services were discussed, which now have to go through a 30-day public comment period before being adopted in April. ‘I struggle with how Texas ends up being different than the 18 other states that we, that couriers regularly operate in a regulated fashion currently,’ Lotto.com Chief Legal Counsel Rob Porter said during public comment on the proposed rule changes. ‘The laws aren’t significantly different. The responsible couriers like lotto.com have the same security, we have the same technological protections, we have the same responsible play guidelines that we use in other states. We keep the lottery informed here, just as we do everywhere else, and we’re going to do it as long as we’re allowed.’
While lottery couriers can plead their case in Texas, it seems like the cake is already baked. Even if the proposed lottery rules changes were not to take effect, there’s also momentum behind a legislative proposal to ban them. Odds on couriers staying in Texas are off the board.
Meanwhile, the optics around the Texas Lottery continue to get worse. More from the Houston Chronicle (paywall).
Binge Drinking Among Sports Gamblers (National Library of Medicine): “In this survey study, binge drinking in both men and women was reported at greater frequency among sports wagering individuals compared with nongamblers and non–sports gamblers. This study is limited by its cross-sectional design and use of nonprobability polling methods. Regardless, with past research showing that sports gamblers are more likely to report symptoms of alcohol use disorder, our results suggest that individuals who wager on sports use alcohol in particularly risky ways. Given the rapid spread of sports wagering in the US over recent years, this finding highlights an immense need for ongoing research, particularly to examine how novel gambling technologies influence the prevalence, presentation, and prevention of alcohol use disorders and related harms.”
Hawaii House passes online sports betting bill (SBC Americas): “The effort to legalize online sports betting in Hawaii took a big step forward on Tuesday when it was approved in the House. Representatives voted 35-15 to pass Honolulu Rep. Daniel Holt’s HB 1308. Only three of the yes votes came with reservations.”
While this is a positive development for proponents of legal sports betting, similar legislation has not progressed in the Senate and that seems unlikely to change.
When Will Bet365 Launch In Illinois And Tennessee? (Legal Sports Report): “Bettors in Tennessee and Illinois could soon have access to one of the most popular global sportsbooks in bet365. Bet365 has been very deliberate in its rollout into the United States. The UK betting powerhouse is live in 11 states, but that should increase to 13 in the near future. When, exactly, is unknown.
While the sportsbook is fully licensed in both states and could launch at any point, bet365 declined to comment on its launch dates as it has in the past.”
Gambling newsletter roundup
For sponsorship inquiries, email dustin@closinglineconsulting.com.
