Prediction market platform Kalshi is facing a lawsuit accusing it of operating an illegal sports betting site. The lawsuit alleges that Kalshi misled users by presenting wagers as legal investments, while its operations allegedly mirrored traditional gambling. Key accusations include misrepresenting the nature of wagers and failing to disclose gambling-like mechanics, potentially breaching state gambling laws. The outcome of this case could set significant legal precedents for the prediction market industry and affect future regulatory measures. If found liable, Kalshi may face financial penalties, operational limitations, and heightened regulatory oversight.