Yes, Kalshi appears to operate and accept users in Texas, but its legal status is somewhat unclear and carries risk. The platform functions as a federally-regulated “event contract” or prediction market under the Commodity Futures Trading Commission (CFTC) rather than a typical state-licensed sportsbook. Because Texas has not legalized sports betting in the usual way, Kalshi positions itself as an exchange for event contracts rather than gambling under state law. Still, this regulatory difference may not shield users permanently from legal scrutiny.
What Kalshi Is and How It Works
Kalshi allows users to buy and sell contracts that settle based on outcomes of specific events (for example “Will Team X win the championship by date Y?”). The contract price reflects market sentiment; if you buy a contract and the event happens, it settles to a set value (often $1), otherwise $0.
The company argues that this model makes it a financial exchange (subject to CFTC regulation) not a betting or gambling app under state gaming laws.
In Texas, where conventional online sports betting remains illegal under state law, Kalshi claims to operate legally because it does not fall under Texas’s sports-wagering statute, but rather under federal derivatives law.
Legal Grounds in Texas – Why It May Be Permitted
- Texas has not authorized statewide legal sports betting through its state gambling statutes.
- Kalshi contends that because it is regulated by the CFTC, its contracts are outside the jurisdiction of Texas gaming regulators. Some industry sources state Kalshi is accessible in Texas and functioning.
- One legal review says: “Yes, Kalshi is legal in Texas. The federally regulated prediction exchange lets Texans buy and sell event contracts on real-world outcomes.”
- Texas Scorecard (an independent media outlet) argues the practice is “illegal” under Texas law, because the platform facilitates betting on sports events, something Texas prohibits, though enforcement has not materialized.
Thus, the status is somewhat ambiguous. Kalshi is operating and available in Texas, but it is leveraging a legal grey-zone: federal regulation vs state gambling prohibition.
Risks & What to Watch Out For
- State vs federal conflict: If a court or Texas regulator decides that Kalshi’s event contracts are equivalent to “bets” under state law, Kalshi’s model in Texas could face legal challenge. Some states have already issued cease-and-desist orders against Kalshi for similar concerns.
- Lack of Texas specific license: Kalshi is not a Texas-licensed sportsbook; if Texas law eventually expands or interprets its gambling laws differently, users may lose protections or Kalshi may be blocked.
- User protections and regulation: Because the model is non-traditional, protections typical in regulated sportsbooks (responsible gambling tools, state oversight, consumer protections) may be weaker.
- Legislative or regulatory changes: Texas might amend its laws to explicitly cover platforms like Kalshi, which could alter its legality or regulatory status.
- Mis-advertising risk: Kalshi’s own advertisements stating “sports betting is legal in Texas” have raised red flags, as Texas has not legalized sports wagering. This may indicate a marketing risk or regulatory exposure.
Final Note
Yes — as of now, you can use Kalshi in Texas, because the platform argues it is regulated federally rather than under Texas’s sports betting law. However, the legal status is not iron-clad. If Texas regulators or courts interpret Kalshi’s event contracts as gambling under state law, or if regulation changes, the platform’s availability or your risk exposure could change.
