Happy Monday in New York City, a place with a long history of betting. From horse races at Belmont to high-stakes mahjong games in Chinatown to the three new downstate casinos currently being built in the Bronx and Queens, there are a variety of ways to gamble away your money in this city.

State officials are trying to make sure prediction markets don’t become another one.

Prediction markets like Kalshi and Polymarket give users the opportunity to wager on real-life events, except instead of betting against the house, they purchase yes-or-no “contracts” tied to the probability of an outcome and then trade those contracts among each other, like a stock exchange. It’s a complicated distinction that currently exempts prediction markets from federal and state gambling laws. But according to Letitia James, it’s really not that complicated at all.

“No matter what they call themselves, prediction markets like Kalshi are gambling platforms, plain and simple,” James, the state attorney general, wrote in a statement announcing a lawsuit against Kalshi. “By ignoring our laws, Kalshi is running an illegal operation and harming New Yorkers in the process.”

James’ lawsuit contends that Kalshi, which is based in New York, functions as an illegal sports betting platform. The state is seeking an injunction that would bar the prediction market from operating in New York as well as $36 million in restitution payments. With this lawsuit, New York joins 15 other states actively engaged in legal action against prediction markets.

Kalshi argues they’ve done nothing wrong. “It’s sad to see this type of political theater from the leadership in our own state,” Elisabeth Diana, head of communications at Kalshi, said in a statement. “States can’t just shut down a federally licensed exchange. This would also hurt New Yorkers, who would be driven offshore. We love New York, we love New Yorkers, and New Yorkers love our product.”

Kalshi does not currently have a listing on whether New York will win its lawsuit. Can I interest anyone in 2:1 odds?

Not long ago, when someone bought a print copy of The New York Times, that newspaper didn’t just sell information. It monopolized your attention.

You dug into your pocket for some quarters, unfolded the paper on the train, and for the next 30 minutes your focus was locked inside its borders. The ads weren’t competing with the entire internet. You were competing with the crossword puzzle and maybe the guy coughing two seats over. It was a closed ecosystem: finite pages, finite distractions, finite opportunity. Print ads held your attention captive because attention itself was geographically constrained.

The internet and later the smartphone shattered all that. Today, roughly 86% of Americans get their news on a phone, tablet or computer, and for most of them, the phone is the main gateway. 

The iPhone is the anti-monopoly device, a pocket-sized infinity of substitutions. The New York Times no longer competes with The Wall Street Journal; it competes with Amazon, Reddit, TikTok, Candy Crush, Wordle, Instagram, YouTube, Slack, email and the sudden urge to Google that actor in a Netflix show you’re half watching.

But The New York Times, like every publication, never really sold news. It sold your attention, repackaged for advertisers and marketers. Online, that scarcity vanished. Ad inventory exploded. Tens of trillions of impressions now circulate every year, and when supply becomes effectively unlimited, value falls toward zero.

Read on to learn more.

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