The fight over who gets to regulate prediction markets isn't staying inside courtrooms. Kalshi, Polymarket and the Coalition for Prediction Markets have spent at least $3 million on lobbying and political contributions at the state and federal levels in 2026 as the industry faces growing regulatory challenges.
Kalshi has been particularly aggressive, building a lobbying presence in 41 states while continuing to spend heavily in Washington. The push comes as states challenge the industry's argument that event contracts fall under federal CFTC authority rather than individual state laws.
Kalshi is Building a Nationwide Lobbying Network
Kalshi's state operation has expanded quickly. As of September, the company had at least one registered lobbyist in 41 states, with nearly all of those lobbyists brought aboard since April. California and New York have become two of its biggest areas of focus.
Kalshi spent $62,000 lobbying in California during the first half of 2026, while its commitments in New York are projected to exceed $400,000 through July 2027. The company has also spent nearly $1 million on federal lobbying through June 30. Its efforts have targeted:
- The CFTC
- The White House
- The Securities and Exchange Commission
- The House and Senate
- State governors and attorneys general
- State legislatures across the country
Attorneys General Are Getting Plenty of Attention
Kalshi is also funding organizations connected to the state officials central to the regulatory fight. During the first half of 2026, it contributed $147,500 to the Republican Attorneys General Association and $170,000 to the Democratic Attorneys General Association. The company also contributed $100,000 to the Republican Governors Association and $150,000 to the Democratic Governors Association.
Kalshi spokesperson Dani Lever said the company supports candidates on both sides of the political aisle, something many regulated U.S. companies also do. That spending comes at a timely moment. A coalition of 44 state attorneys general wrote to the CFTC in July, arguing against federal rules overriding state authority and putting attorneys general directly in the middle of the industry's biggest regulatory dispute.
Polymarket is Taking a Different Approach
Polymarket has been much quieter at the state level. It hasn't registered state lobbyists, but the company has spent $180,000 on federal lobbying this year through Advocus Partners. The Coalition for Prediction Markets is active too. The group, which includes Kalshi, Robinhood, Coinbase, Crypto.com and Underdog, had spent $100,000 on federal lobbyists through June 30 and another $50,000 lobbying in California.
That gives the industry several different routes into the policy conversation. Kalshi is building a large state-by-state operation, while Polymarket has focused its disclosed lobbying efforts in Washington.
The State Fight Has Changed the Strategy
Prediction market companies are spending this money for practical reasons. Their ability to operate under a single federal framework is being challenged across the country, and courts haven't provided a consistent answer. If states eventually gain broader authority over event contracts, platforms could face licensing requirements and different rules depending on where a trader lives.
Kalshi's presence in 41 states gives it relationships and infrastructure that could become particularly valuable if that happens. The industry isn't waiting for the courts to settle everything before preparing for that possibility.
The Trade Handle Prediction Markets Take
We've spent much of 2026 watching prediction markets fight states through lawsuits. Lobbying numbers show another fight happening outside the courtroom that's becoming just as important. Kalshi's strategy is particularly telling. A company arguing strongly for federal authority is simultaneously building a lobbying operation across nearly the entire country.
That's not necessarily contradictory. It's preparation. If the future of prediction markets is going to be decided by judges, regulators, and lawmakers, the biggest platforms clearly don't intend to sit on the sidelines while those decisions get made.