The post Kalshi Faces Lawsuit Over Khamenei Prediction Market appeared on BitcoinEthereumNews.com.

A class action lawsuit has been filed against prediction market Kalshi, alleging that the death carveout in the “Ali Khamenei out as Supreme Leader” market was not properly disclosed to users and that the platform failed to pay out winning trades. The plaintiffs said that the death carveout policy was “not incorporated into the user-facing rules summary,” and was not displayed in a way that would notify a “reasonable consumer” of the policy or its effects. “Defendants, themselves, later acknowledged that their prior disclosures were ‘grammatically ambiguous,’” the lawsuit filing said. The class action lawsuit against Kalshi. Source: Court Listener Kalshi voided trading positions for the market after the death of Khamenei, the former Iranian Supreme Leader, was confirmed, meaning the market did not resolve to a “yes.” “We don’t list markets directly tied to death. When there are markets where potential outcomes involve death, we design the rules to prevent people from profiting from death,” Kalshi co-founder Tarek Mansour said. Source: Tarek Mansour The plaintiffs characterized the carveout policy as “predatory” and an “unfair” business practice for this specific market. The lawsuit said: “With an American naval armada amassed on Iran’s doorstep and military conflict not merely foreseeable but widely anticipated, consumers understood that the most likely, and in many cases the only realistic, mechanism by which an 85-year-old autocratic leader would ‘leave office’ was through his death. Defendants understood this as well.” Mansour also announced reimbursements for users affected by the carveout policy, calculated using the “last traded price” for the market before the death of Khamenei was confirmed. The reimbursement policy also drew significant pushback from users.  The plaintiffs in the lawsuit say that the methodology and precise timestamps used to calculate the “last traded price” for the prediction market were not disclosed or transparent.  Related: Kalshi…

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Filed under: News - @ March 8, 2026 1:25 pm