Kalshi is increasing its lobbying efforts in Washington, D.C., to address regulatory challenges and potential legislative actions affecting its prediction market business. The company has hired over two dozen federal lobbyists, many of whom have experience working in Congress, including former legislative directors and chiefs of staff. Notably, former Senator Blanche Lincoln is part of Kalshi's influence team, and the company has appointed Tony Hanagan, a former Republican staffer, as head of congressional affairs. Kalshi allows users to bet on the outcomes of various future events, including political ones, and has even employed a former communications director for Senator Jeff Merkley, who has criticized prediction markets, to lobby on its behalf.
John Bivona, Kalshi's head of federal government relations, stated, "Kalshi is leading the push for bipartisan legislation that protects consumers, keeps minors off our platform, and makes insider trading bans standard across the industry." The company has been actively promoting this message in Washington, including through advertisements in the district.
This year, lawmakers have introduced more than two dozen bills aimed at regulating prediction markets. However, while some senators have prohibited themselves from trading in prediction markets and the House has banned trades over congressional Wi-Fi, no significant legislation has been passed to restrict the types of bets offered or the users of these markets.
Senator Merkley expressed concerns about the financial power of prediction markets, stating, "Organizations like this make massive amounts of money. They’re going to spend massive sums on lobbyists and media campaigns to try to make sure it doesn’t get shut down. And they have the support of the president." Kalshi has shown support for the Prediction Market Act of 2026, which would prevent Congress members and the president from trading, and has endorsed a bill by Representative Josh Gottheimer aimed at keeping children off prediction market platforms.
Despite this support, these bills are currently stalled in Congress. Prediction markets, which allow users to bet on real-world outcomes, have been criticized by some lawmakers as a form of online gambling. Representative Blake Moore remarked that Kalshi has transformed prediction markets into a platform for easy online gambling, which he argues is contrary to their intended purpose as financial tools.
Kalshi maintains that its offerings are distinct from gambling, asserting that it is incorrect to equate its platform with traditional sports betting. The company argues that attempts by states to shut down its operations are unprecedented and overly aggressive. However, some lawmakers, including Representative Greg Landsman, have expressed skepticism about Kalshi's distinction, stating, "They’re creating opportunities for people to bet on an event that people don’t know the outcome to. That’s gambling, isn’t it?"
Recently, the U.S. Court of Appeals for the 9th Circuit ruled that states can regulate prediction markets as gambling, contradicting a previous ruling from the 3rd Circuit Court of Appeals in favor of Kalshi. Senator Richard Blumenthal noted that states are successfully suing to regulate prediction markets, while he and Senator Katie Britt have introduced a bill to prevent social media platforms from advertising these markets to minors, highlighting concerns about underage access and potential risks associated with prediction markets.