Robinhood Restricts Sports-Event Contracts in Michigan Pending Sixth Circuit Appeals and Kalshi Injunction
SCCG Take — Michigan’s dual approach favors licensed operators by closing perceived regulatory gaps. Prediction platforms must now weigh voluntary restrictions against prolonged litigation risk.
Robinhood has agreed to block Michigan customers from new sports-related event contract positions while appeals proceed in the U.S. Court of Appeals for the Sixth Circuit involving the company, Coinbase, and Kalshi, along with a parallel state court case against Kalshi.
The step follows a preliminary injunction that Attorney General Dan Nessel obtained against Kalshi last week. Robinhood will continue offering its broader prediction markets hub. Michigan officials agreed not to enforce state sports betting laws against the firm during compliance. The arrangement ends upon final resolution of the Sixth Circuit matters, including any Supreme Court proceedings, or dissolution of the state injunction.
Robinhood Agreement Terms
“While we do not believe these contracts violate any state laws, beginning on (Wednesday), we will restrict customers in Michigan from entering new sports-related event contract positions,” a Robinhood spokeswoman said in a statement emailed to CDC Gaming. Messages left with the Michigan Gaming Control Board and Nessel were not returned.
Kalshi Injunction Details
Ingham County Circuit Court Judge Rosemarie Aquilina ordered Kalshi to stop offering, listing, executing, settling, or otherwise facilitating sports-event contracts for anyone located in Michigan. “Michigan and its most vulnerable citizens are suffering and will continue to suffer immediate and irreparable harm absent relief from being exploited by Kalshi’s sports betting operation masquerading as an investment opportunity,” Aquilina wrote in the five-page filing.
The ruling requires Kalshi to use a third-party geolocation provider licensed by the MGCB. Noncompliance carries a $500,000 fine for each day. Aquilina noted Kalshi eludes Michigan’s patron-protection mechanisms and gains a “massive and unfair advantage” over compliant licensees. Nessel said he was relieved the order protects residents from Kalshi’s predatory practices.
Litigation Outlook
Where state enforcement meets federal appeals, prediction platforms face immediate operational limits in Michigan. The paired cases will clarify how sports-event contracts fit within existing gaming statutes without adding new regulatory language.
Reporting: CDC Gaming
Generated by SCCG’s automated editorial system from published source reporting. SCCG Management holds editorial responsibility.
Prediction platforms now choose between voluntary retreat and daily half-million-dollar fines while regulators protect licensed sportsbook turf.
We have watched prediction markets test regulated boundaries for years. Michigan is drawing a bright line: if you look like sports betting, you need a sports betting license. Robinhood blinked, Kalshi faces ruinous penalties, and every platform now calculates whether federal CFTC cover still shields them at the state level.
- Robinhood blocks new Michigan sports contracts during Sixth Circuit appeals; state agrees not to enforce during compliance
- Judge slaps Kalshi with preliminary injunction and $500K daily penalty for operating without state sports betting license
- Dual federal-state litigation will define whether event contracts escape gaming statutes or require full licensing
SCCG angle: SCCG advises platforms on regulatory strategy across all 38 US jurisdictions. When a client faces this crossfire—state enforcement versus federal authority—we map the licensing paths, connect them to the right gaming boards and compliance counsel, and help them decide whether to fight, pivot product, or apply for a license before the fine clock starts.
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