Michigan Extends Kalshi Sports Contract Ban, Sets $500,000 Daily Fines

A Michigan judge has extended the temporary ban on Kalshi's sports event contracts and given the prediction market until August 12, 2026 to fully geofence the state or face fines of $500,000 a day. Ingham County Circuit Court Judge Rosemarie Aquilina ruled on Monday, July 13 that the temporary restraining order she first issued on June 29 will stay in force, sharply raising the threatened penalty from an earlier $120,000 per day and setting a hard 30-day window for Kalshi to switch from address-based blocking to real-time location technology.

What did the Michigan judge actually rule?

Judge Aquilina extended the existing restraining order that bars Kalshi from offering sports-related event contracts to Michigan residents, and attached a firm compliance deadline. Kalshi has until August 12 to deploy geofencing that blocks users by their live location rather than by the address they gave at sign-up. If the technology is not operational, a $500,000 daily fine is scheduled to begin on August 13. The court set a follow-up status hearing for the following week to check on progress.

Key facts

• Ruling date: Monday, July 13, 2026, by Judge Rosemarie Aquilina of Michigan's 30th Circuit Court in Ingham County.
• Geofencing deadline: August 12, 2026, with $500,000 daily fines from August 13 for non-compliance.
• Original penalty: The initial June 29 restraining order threatened $120,000 per day, so the extended order more than quadruples the daily exposure.
• Technology partner: Kalshi says it is coordinating with geolocation provider GeoComply on the rollout.

Why is $500,000 a day so significant?

The jump from $120,000 to $500,000 per day signals that the court is losing patience with a company it sees as defining compliance on its own terms. At half a million dollars a day, a single week of non-compliance would cost Kalshi $3.5m, and a full month would exceed $15m. That is a scale of penalty designed to make it cheaper for the exchange to build the technology than to litigate around it.

"What you're doing is defining it in a way that works for you, but not for Michigan," Judge Aquilina told the company during the hearing, adding that Kalshi was dealing with "gambling, which has traditionally been denied by the states."

How is Kalshi currently blocking Michigan users?

Kalshi presently restricts access using the registration address a customer provides at sign-up, not their real-time position. After Kalshi filed an emergency motion earlier in the dispute, the court had allowed this narrower address-based approach as an interim step. The problem, from the state's perspective, is that address-based blocking is easy to evade and does nothing to stop a Michigan resident who lists an out-of-state address. Geofencing, by contrast, reads a device's live GPS and network signals, the same method licensed Michigan sportsbooks such as FanDuel and DraftKings already use to keep bets inside state lines.

What is a prediction market and why does Michigan call it gambling?

Kalshi is a federally regulated exchange overseen by the Commodity Futures Trading Commission (CFTC), where users trade yes or no contracts on the outcome of future events. Kalshi argues these are financial derivatives protected by federal commodities law, and therefore beyond the reach of individual state gaming regulators. Michigan counters that a contract on who wins a football game is functionally a sports bet, and that offering it without a state licence breaks Michigan gaming law. That clash, federal commodities oversight versus state gambling authority, sits at the heart of Kalshi disputes across the country.

What did Kalshi argue in court?

Kalshi told the court that full geofencing is technically complex, that it could not commit to a firm completion timeline, and that a state-by-state patchwork of location rules risks conflicting with its federal commodities regulation. The company said implementation depends on coordination with GeoComply. The judge was unmoved on cost, reportedly noting that compliance would be expensive but that this was "the cost of doing business."

How did this Michigan case start?

Michigan Attorney General Dana Nessel sued Kalshi earlier in 2026 over what the state described as unlicensed sports betting, and the Michigan Gaming Control Board has been one of the most aggressive US regulators on prediction markets. Judge Aquilina issued the first temporary restraining order on June 29, ruling that Kalshi's sports event contracts amounted to illegal sports wagering in the state. The July 13 decision extends and hardens that order rather than starting a new case.

Is Michigan the only state fighting Kalshi?

No. Michigan is one of the few states to actually enforce a court-ordered halt, but Kalshi is facing legal and regulatory pressure across roughly two dozen jurisdictions. Some cases have gone Kalshi's way on federal-preemption grounds, while others have produced injunctions or fines. The table below summarizes where major enforcement actions stood as of July 2026.

State	Action against Kalshi sports contracts	Status (July 2026)
Michigan	State court restraining order, AG lawsuit	Ban extended, geofencing ordered by Aug 12
Nevada	District court injunction	Enforced, appealed to Ninth Circuit
Massachusetts	State lawsuit and injunction	Sports contracts remain banned, on appeal
Ohio	Casino Control Commission fine	$5m fine upheld by lower court
Maryland	Lawsuit over state gaming law	Preliminary injunction denied, on appeal
Minnesota	Law banning prediction markets	Effective August 1, 2026

What does GeoComply have to do with it?

GeoComply supplies the location-verification technology behind most of the legal US online betting market, checking hundreds of millions of transactions to confirm a bettor is physically inside a licensed state. Kalshi pointing to GeoComply is telling: it signals the exchange may end up adopting the same geofencing stack that licensed sportsbooks rely on, which would undercut its argument that it is fundamentally different from a betting operator.

How does this compare with Kalshi's federal wins?

Kalshi has repeatedly beaten back state action in federal court by arguing CFTC oversight preempts state gambling law, and several federal judges have agreed, granting injunctions that block states from enforcing against the exchange. Michigan matters because it is a state court proceeding grounded in state gaming law, a venue where Kalshi has had less success. Alongside Nevada and Massachusetts, it shows that state courts remain willing to treat sports event contracts as gambling regardless of the federal debate.

What happens next?

The immediate milestone is the August 12 deadline. If Kalshi geofences Michigan in time, it avoids the $500,000 daily fines but effectively concedes that it can wall off individual states, an admission that other regulators will note. If it misses the deadline, the fines start accruing on August 13 and the confrontation escalates. The court's follow-up status hearing the following week will show whether the two sides are moving toward compliance or deeper into litigation.

Why does this matter for the wider industry?

Prediction markets have become the most disruptive force in US betting, and Michigan is drawing a clear line: offer event contracts on sports here without a licence and you will be treated like an unlicensed sportsbook. For licensed operators who pay for state licences and tax, a court forcing Kalshi to geofence like everyone else is a step toward a level playing field. For Kalshi, a half-million-dollar daily threat is a powerful nudge to comply now and argue later.

FAQ

What did the Michigan judge order Kalshi to do?

Judge Rosemarie Aquilina extended a temporary restraining order banning Kalshi's sports event contracts in Michigan and gave the company until August 12, 2026 to implement geofencing, or face $500,000 in daily fines from August 13.

How much are the new fines?

Up to $500,000 per day, more than four times the $120,000 daily penalty threatened in the original June 29 order.

When is the deadline?

August 12, 2026 to have geofencing operational. Non-compliance fines are scheduled to begin the next day, August 13.

Is Kalshi banned in other US states?

Kalshi faces enforcement in around two dozen states. It remains blocked by court order in states including Nevada and Massachusetts, has been fined in Ohio, and faces a statutory ban in Minnesota effective August 1, 2026, though it has won several cases in federal court on preemption grounds.

Why does Michigan treat Kalshi contracts as gambling?

Michigan argues a yes or no contract on a sports result is functionally a sports bet, so offering it without a state gaming licence breaks Michigan law. Kalshi says its contracts are federally regulated commodities, not gambling.

Updated July 2026. Reporting drawn from Gambling Insider, InGame and Legal Sports Report.