Arkansas has become yet another state formalizing its stance against prediction markets, as Attorney General Tim Griffin has determined that platforms like Kalshi would breach gambling legislation by operating unlicensed.

This assessment follows similar enforcement actions in states like Ohio, New Jersey, Arizona, and Massachusetts, indicating a heightened scrutiny of unlicensed event contract platforms across the nation.

In an official communication dated October 23, Griffin addressed concerns raised by State Sen. Bryan King regarding the legality of Kalshi—a platform that permits users to wager on the outcomes of events including elections, sports, and various future scenarios—under Arkansas law.

The attorney general’s viewpoint, released as Opinion No. 2025-073, concluded that these activities are classified as gambling and thus necessitate proper licensure to operate lawfully within the state.

“The activities you mention align with the Supreme Court’s definition of gambling: a participant risks monetary assets on the uncertain outcome of a future event,” Griffin noted. “The rebranding of such gambling activities as ‘prediction markets’ does not exempt them from regulatory scrutiny.”

Griffin referenced existing Arkansas statutes that prohibit individuals from “receiving or transmitting information” related to sports or gaming “to facilitate gambling.” Hence, he concluded that an entity like Kalshi would similarly breach the law if it processed or conveyed information tied to wagers without appropriate licensing.

He stated that Arkansas’s gambling regulations are broadly interpreted to prevent operators from circumventing regulation through rebranding or employing novel terminologies. Griffin emphasized that courts interpret gambling laws “liberally” and “in favor of restrictions,” in line with the state’s long-standing regulatory framework for gambling.

In another segment of the opinion, Griffin explored whether prediction markets would fall under Arkansas’s taxation on fantasy sports. He determined that these markets would not qualify as “paid fantasy sports games” under state statutes, as winning outcomes do not rely “predominantly on the cumulative statistical performance of individual players.”

Consequently, prediction markets would neither incur state fantasy sports taxes nor avail themselves of the tax exemptions designated for this category.

While retail and online sports betting are permitted in Arkansas, operators are required to allocate 51% of their revenue to local casino partners. This stipulation has constrained participation from national sportsbook entities. At present, only three operators, all leveraging local casino branding, offer sports betting in the state.

The Arkansas opinion comes at a time when other states are taking diverse enforcement actions. Massachusetts Attorney General Andrea Campbell has initiated a lawsuit against Kalshi, whereas Ohio, New Jersey, and Arizona have dispatched cease-and-desist orders to operators of event contract platforms.