Prediction Market 'Kalshi' Sued for Not Paying $54 Million for Bets on Khamenei's Death (reuters.com)
(Saturday March 07, 2026 @11:34AM (EditorDavid)
from the bettor-off dept.)
- Reference: 0180922104
- News link: https://news.slashdot.org/story/26/03/07/0251222/prediction-market-kalshi-sued-for-not-paying-54-million-for-bets-on-khameneis-death
- Source link: https://www.reuters.com/world/middle-east/kalshi-sued-over-ouster-iran-leader-prediction-market-2026-03-06
An anonymous reader shared [1]this report from the Independent :
> A popular predictions market app will not pay out the $54 million some of its users believed they were owed after correctly forecasting the death of Ayatollah Ali Khamenei, according to a report.
>
> Kalshi, which allows players to gamble on real-world events, offered customers favorable odds on Khamenei, 86, being "out as Supreme Leader" in response to the announcement of joint U.S.-Israeli airstrikes on Tehran in the early hours of Saturday morning. The company promoted the trade on its homepage and app and [2]tweeted [last] Saturday : "BREAKING: The odds Ali Khamenei is out as Supreme Leader have surged to 68 percent." It continued: "Reminder: Kalshi does not offer markets that settle on death. If Ali Khamenei dies, the market will resolve based on the last traded price prior to confirmed reporting of death." Khamenei was later [3]confirmed dead in the airstrikes and the company clarified in a [4]follow-up post : "Please note: A prior version of this clarification was grammatically ambiguous. As a customer service measure, Kalshi will reimburse lost value due to trades made between these clarifications...."
>
> While the company has offered to reimburse any bets, fees or losses from the trade placed prior to its clarification message, it has nevertheless attracted a firestorm of complaints on social media.
A [5]Kalshi spokesperson told Reuters they'd reimbursed "net losses" out of pocket "to the tune of millions of dollars". But a class action lawsuit was filed Thursday saying Kalshi had failed to pay $54 million:
> Kalshi did not invoke a "death carveout" provision until after the Iranian leader was killed to avoid paying customers in Kalshi's "Khamenei Market" what they were owed, the lawsuit said... The language specifying that Khamenei's departure could be due to any cause, including death, was "clear, unambiguous and binary," the lawsuit said, describing Kalshi's actions as "deceptive" and "predatory."
"In [6]a notice filed Monday, the company proposed standardizing the terms of all its markets that implicitly depend on a person surviving..." [7]reports Business Insider . "The update comes after Kalshi paid $2.2 million to resolve complaints from users who were confused by the way it divided the $55 million wagered on Iran's Supreme Leader Ali Khamenei's ouster after his targeted killing by Israel and the US."
Their article cites a DePaul University law professor who says "There's now sort of this nascent, but bipartisan movement against prediction markets. I think Kalshi's feeling the heat." For example, U.S. Senator Chris Murphy [8]told the Washington Post , "People shouldn't be rooting for people to die because they placed a bet."
[1] https://www.independent.co.uk/news/world/americas/us-politics/kalshi-bets-iran-ayatollah-ali-khamenei-death-b2932018.html
[2] https://x.com/Kalshi/status/2027773190420718034
[3] https://www.independent.co.uk/news/world/middle-east/iran-ayatollah-khamenei-assassination-airstrikes-b2929787.html
[4] https://x.com/Kalshi/status/2027816005049651250
[5] https://www.reuters.com/world/middle-east/kalshi-sued-over-ouster-iran-leader-prediction-market-2026-03-06/
[6] https://www.cftc.gov/sites/default/files/filings/orgrules/26/03/rules03022640155.pdf
[7] https://www.businessinsider.com/kalshi-iran-prediction-market-death-rule-fine-print-2026-3
[8] https://finance.yahoo.com/news/bettors-wagered-54-million-khamenei-141341094.html
> A popular predictions market app will not pay out the $54 million some of its users believed they were owed after correctly forecasting the death of Ayatollah Ali Khamenei, according to a report.
>
> Kalshi, which allows players to gamble on real-world events, offered customers favorable odds on Khamenei, 86, being "out as Supreme Leader" in response to the announcement of joint U.S.-Israeli airstrikes on Tehran in the early hours of Saturday morning. The company promoted the trade on its homepage and app and [2]tweeted [last] Saturday : "BREAKING: The odds Ali Khamenei is out as Supreme Leader have surged to 68 percent." It continued: "Reminder: Kalshi does not offer markets that settle on death. If Ali Khamenei dies, the market will resolve based on the last traded price prior to confirmed reporting of death." Khamenei was later [3]confirmed dead in the airstrikes and the company clarified in a [4]follow-up post : "Please note: A prior version of this clarification was grammatically ambiguous. As a customer service measure, Kalshi will reimburse lost value due to trades made between these clarifications...."
>
> While the company has offered to reimburse any bets, fees or losses from the trade placed prior to its clarification message, it has nevertheless attracted a firestorm of complaints on social media.
A [5]Kalshi spokesperson told Reuters they'd reimbursed "net losses" out of pocket "to the tune of millions of dollars". But a class action lawsuit was filed Thursday saying Kalshi had failed to pay $54 million:
> Kalshi did not invoke a "death carveout" provision until after the Iranian leader was killed to avoid paying customers in Kalshi's "Khamenei Market" what they were owed, the lawsuit said... The language specifying that Khamenei's departure could be due to any cause, including death, was "clear, unambiguous and binary," the lawsuit said, describing Kalshi's actions as "deceptive" and "predatory."
"In [6]a notice filed Monday, the company proposed standardizing the terms of all its markets that implicitly depend on a person surviving..." [7]reports Business Insider . "The update comes after Kalshi paid $2.2 million to resolve complaints from users who were confused by the way it divided the $55 million wagered on Iran's Supreme Leader Ali Khamenei's ouster after his targeted killing by Israel and the US."
Their article cites a DePaul University law professor who says "There's now sort of this nascent, but bipartisan movement against prediction markets. I think Kalshi's feeling the heat." For example, U.S. Senator Chris Murphy [8]told the Washington Post , "People shouldn't be rooting for people to die because they placed a bet."
[1] https://www.independent.co.uk/news/world/americas/us-politics/kalshi-bets-iran-ayatollah-ali-khamenei-death-b2932018.html
[2] https://x.com/Kalshi/status/2027773190420718034
[3] https://www.independent.co.uk/news/world/middle-east/iran-ayatollah-khamenei-assassination-airstrikes-b2929787.html
[4] https://x.com/Kalshi/status/2027816005049651250
[5] https://www.reuters.com/world/middle-east/kalshi-sued-over-ouster-iran-leader-prediction-market-2026-03-06/
[6] https://www.cftc.gov/sites/default/files/filings/orgrules/26/03/rules03022640155.pdf
[7] https://www.businessinsider.com/kalshi-iran-prediction-market-death-rule-fine-print-2026-3
[8] https://finance.yahoo.com/news/bettors-wagered-54-million-khamenei-141341094.html
it was all fun and games until (Score:3)
by oumuamua ( 6173784 )
this bet: I predict Jihadists will retaliate on prediction market headquarters
Shakespeare had this right (Score:2)
by Arrogant-Bastard ( 141720 )
"A plague o' both your houses!"
I can only hope that this lawsuit escalates into...well, I hope it escalates without upper bound. Parasites suing parasites is the kind of quality legal theater that we can all appreciate.
New thing only good until it is not... (Score:1)
by deep_space_pine ( 10503110 )
I love new tech and services, but watching crypto tank and seeing these prediction markets renege on bets - it is truly a beautiful thing when greedy people get their fair share of shit.
They are ripping bettors off. (Score:2)
by Hey_Jude_Jesus ( 3442653 )
They bet that he would be out of office and not that he would be killed. Well if they refund all of the bets the people will no longer have a claim. If they don't the trial lawyers are going to tear that co. a part.
The End Cannot Come Soon Enough (Score:5, Insightful)
All the prediction "markets" are senseless scams. They can only survive by arbitrarily choosing when not to pay. It's the only possible way for the house to always win. These things should never have been allowed to exist.
I don't understand how they bypass ani-gambling laws.
I don't understand why anyone would put money into them.
These scam operations cannot die soon enough.
Re:The End Cannot Come Soon Enough (Score:5, Funny)
> These scam operations cannot die soon enough.
Wanna bet?
Re: (Score:2)
On those prediction markets? That won't pay out if I win? No, thanks!
Re:The End Cannot Come Soon Enough (Score:4, Interesting)
> I don't understand how they bypass anti-gambling laws.
Perhaps it is difficult to write such a law in a way that also still allows for non-voting, non-dividend-yielding public stocks. Might be easier to just let this prediction market nonsense to go on as long as there isn't a way for people to slide their retirement accounts into it (like they now can with crypto)
The End Is Already Here. Legally. (Score:2)
> I don't understand how they bypass ani-gambling laws.
Easy. By calling them "prediction markets" instead of fucking gambling.
It allows the grown-ass children that comprise the average constituency to dismiss the obvious harm caused by gambling addiction when addicting themselves. As well as dismiss and ignore that harm when handing off that addiction to their children in the form of "loot boxes". Might as well just include a six-pack of scratch off tickets with every Happy Meal. You know, get them extra happy about "winning" in life. Early.
> I don't understand why anyone would put money into them.
Easy. Because
Re: (Score:1)
> All the prediction "markets" are senseless scams.
That you don't like something doesn't make it a scam.
> They can only survive by arbitrarily choosing when not to pay. It's the only possible way for the house to always win.
That's not true. And your assumption that this must somehow be true reflects your general lack of understanding or knowledge of how prediction markets function. The market get small fees and also get to keep the interest from money on the market. That's how the "house" wins here. In a prediction market, each claim is a 2-sided one with one person owning a yes share, and one owning a no share. This is substantially different than a traditional casino where
Re: (Score:2)
The house wins because it takes a fee. The payout price is just the other side of the bet. IMO the only reason why they aren't already illegal under anti bucket shop law is that the house isn't the counterparty.
Re: (Score:2)
> the house isn't the counterparty.
Yet, they decide when to pay AND change the rules midstream. Why, Who benefits from the sudden change? Kalshi benefits.