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What to know:
- Traders have filed a lawsuit against Kalshi, claiming the platform refused to pay about $54 million to traders.
- The CEO had defended the company’s decision, stating that the platform’s rules exclude death as a valid outcome for resolving the markets.
A lawsuit has been filed against the prediction market platform Kalshi over allegations that it failed to pay millions to traders who placed bets on the political future of Ali Khamenei.
The complaint was filed on Thursday, and it claims that the company refused to settle about $54 million in winning bets from users who predicted that Khamenei would leave office before the 1st of March. The disputes came after it was reported that the Iranian leader was killed on Saturday during joint U.S.–Israeli strikes that targeted senior officials in Iran.
According to the lawsuit, traders participated in a market bet on Kalshi that asked whether Khamenei would leave office before the deadline. The plaintiffs argue that the outcome should have been resolved in their favor after the 85-year-old leader was killed, which clearly means he was removed from power.
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According to the complaint submitted, Kalshi refused to settle the predictors peacefully but instead brought in a contractual clause referred to as a “death carveout.”
The lawsuit also claimed that the company applied the clause after Khamenei’s death and that it was done in order to avoid paying customers who had predicted earlier that he would leave the office before the deadline.
Plaintiffs also argued that the possibility of Khamenei’s death was understood by traders as a realistic path through which the prediction could resolve.
Kalshi Defends Its Market Rules
In response to the allegations, Kalshi’s CEO, Tarek Mansour, said the company acted in accordance with its already established market rules.
Mansour shared on X that the platform had clearly defined the conditions and explained that death doesn’t count as a qualifier for resolving the market in favor of the traders that bet that Khamenei would leave office.
We stand by principle and law:
1. Kalshi didn’t deviate from its market rules. They were clear that death did not resolve the market to “Yes”.
2. Kalshi’s rules prevented a ‘death market’, where traders directly profit from death. This is a good thing (+ we’re a US based… https://t.co/gXMeQECFLz
— Tarek Mansour (@mansourtarek_) March 6, 2026
According to him, the rule was designed to prevent the prediction markets from becoming a platform where participants could profit directly from a person’s death.
Tarek Monsour, CEO Kalshi, Source: Bloomberg
He also said the company did not financially benefit from the disputed market and that Kalshi reimbursed users who lost money in the event. Mansour also added that so far, no customer has left the market.
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About Onyi
Onyinye is a News Desk writer at Tronweekly with one year of experience covering blockchain technology, decentralized finance (DeFi), and emerging Web3 developments. She focuses on delivering clear, timely, and accurate crypto news, monitoring breaking stories, ecosystem updates, and crypto-related crimes and enforcement developments. Based in Nigeria, Onyinye has contributed to multiple digital media platforms and holds a degree in Mass Communication, following strict newsroom and fact-checking standards to ensure reliable reporting for a global audience.
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