Arizona has become the first state to file criminal charges against prediction market company Kalshi, accusing the company of operating an illegal gambling business within its borders. The 20-count charging document accuses Kalsh of accepting bets on political outcomes, college sporting competitions, and individual player performance in violation of Arizona's gambling laws. The case is part of a legal battle over whether prediction markets should be subject to the same rules as gambling companies. At least nine other states have taken legal action against KALShi, and Utah's governor has pledged to sign a bill that could undermine the company's business in the state. The outcome of this case could have implications for how sports betting, which makes up roughly 90% of KalsHI's trading volume, is uncertain.