{"id":3233,"date":"2026-06-18T17:31:06","date_gmt":"2026-06-18T17:31:06","guid":{"rendered":"https:\/\/www.bettingjobs.com\/?p=3233"},"modified":"2026-07-04T17:34:45","modified_gmt":"2026-07-04T17:34:45","slug":"dont-fence-me-in","status":"publish","type":"post","link":"https:\/\/www.bettingjobs.com\/bettingjobs-complianceandmore-partnerships\/dont-fence-me-in\/","title":{"rendered":"Don\u2019t fence me in"},"content":{"rendered":"<p><strong>Oh, give me land, lots of land under starry skies above: <\/strong>Nevada\u2019s contempt application against Kalshi has put a narrow technical question at the center of the prediction market wars: can an operator build compliant geofencing in-house, on a $190,000 budget, or is that a category error?<\/p>\n<ul>\n<li>The argument was kicked off by Nevada, which this week asked for Kalshi to be held in contempt of court.<\/li>\n<li>The state claims the operator is violating a court order because its in-house geofencing tool does not work properly.<\/li>\n<li>Nevada is also asking the court to order Kalshi to pay monetary penalties for every day that its geofencing is deemed inadequate.<\/li>\n<\/ul>\n<p><strong>Let me ride through the wide open country that I love<\/strong>: For John Pappas, industry adviser and regulatory expert, the dispute turns less on cost or technical possibility than on posture.<\/p>\n<ul>\n<li>The question a court should put to an operator facing a contempt claim, he argued, is whether it deployed a recognized, industry-standard compliant system or built something internally and then asserted the result was compliant.<\/li>\n<li>\u201cThose are very different postures,\u201d he said, adding that compliant geolocation is a solved problem for operators that choose to prioritize it.<\/li>\n<\/ul>\n<p><strong>Just turn me loose, let me straddle my old saddle:<\/strong> The state\u2019s filing puts IP-only blocking at a success rate of between 55% and 80%. IP alone, Pappas responded, has never been a sufficient compliance tool: the standard is not where a user claims to be but where they actually are.<\/p>\n<ul>\n<li>Well-designed multi-signal systems reach very high accuracy, including close to a state border.<\/li>\n<li>Manu Gambhir, chief executive of Xpoint, said an IP address identifies a network endpoint, not a person, citing carrier routing and carrier-grade NAT (network address translation), where many users share one public address.<\/li>\n<li>A state line is exactly where IP\u2019s margin of error can straddle the boundary.<\/li>\n<li>Will Whitehead, commercial director at GeoLocs, called IP-only geofencing fit for a first pass, not a compliance-grade control.<\/li>\n<li>Layered systems, including GPS, WiFi positioning and cellular, perform much better, with Xpoint citing roughly 99% and GeoLocs high-90%-plus success at borders.<\/li>\n<\/ul>\n<p><strong>On my cayuse, let me wander over yonder:<\/strong> Kalshi told the court that compliant geofencing could run into the tens of millions, then built its own for $190,000, a contradiction Nevada has seized on.<\/p>\n<ul>\n<li>Pappas said the question is not what it costs to build a geolocation tool, but what it costs to build one that consistently satisfies the regulatory requirements.<\/li>\n<li>Operators from single-state businesses to the largest in the sector deploy compliant systems without treating cost as a barrier.<\/li>\n<li>The problem is not unique to gaming: crypto platforms, financial services firms and streaming providers all manage jurisdiction-based access as routine.<\/li>\n<\/ul>\n<p><strong>I want to ride to the ridge where the West commences:<\/strong> For Gambhir, a tens-of-millions quote is plausible for an operator of Kalshi\u2019s size, but it represents a ceiling not the going rate. No serious operator runs full precision on every user on every action.<\/p>\n<ul>\n<li>A cheap IP read establishes whether someone is even plausibly near a prohibited jurisdiction, reserving the costly multi-signal checks for users near a border.<\/li>\n<li>\u201cThe headline figures usually assume a brute-force model, full precision on everyone, all the time, that nobody serious actually runs,\u201d he said.<\/li>\n<li>Whitehead put a mature solution\u2019s cost down to accumulated expertise and ongoing support, not prohibitive technology. Both judged the real figure to sit well below Kalshi\u2019s estimate.<\/li>\n<\/ul>\n<p><strong>And gaze at the moon till I lose my senses<\/strong>: Nevada\u2019s claim that its investigators bought contracts from inside the state, without a VPN, drew the most damaging contrast with Kalshi\u2019s reported reliance on \u201cfamily and friends\u201d testing. Pappas is unconvinced by the in-house route.<\/p>\n<ul>\n<li>Regulated gaming, he said, subjects geolocation to extensive independent testing before launch, including specialized laboratories, scripts probing real-world and adversarial scenarios, and with periodic retesting required as masking techniques evolve.<\/li>\n<li>Compliance is an ongoing process, not a one-time certification, and a world away from informal testing by untrained users.<\/li>\n<\/ul>\n<p><strong>Listen to the murmur of the cottonwood trees:<\/strong> Whitehead described exactly that kind of cycle: controlled in-state and out-of-state testing on real devices, boundary validation, systematic VPN and spoofing-resistance testing, audit logging and independent certification.<\/p>\n<ul>\n<li>Gambhir cited the GLI-19 and GLI-33 standards as the benchmark for what \u201ctested\u201d means, though they do not formally apply to prediction markets.<\/li>\n<li>He noted a credential that may weigh more with a regulator than any accuracy figure: serious providers are themselves licensed as gaming vendors state by state, and so already vetted.<\/li>\n<\/ul>\n<p><strong>No, papa, don\u2019t you fence me in:<\/strong> On the limits, there is no disagreement: a 100% block is not technically possible, and the honest standard is a commercially reasonable, continuously tested best effort.<\/p>\n<ul>\n<li>Gambhir noted that Kalshi\u2019s dual DCM and FCM structure creates geolocation challenges a straight sportsbook does not face.<\/li>\n<li>They are solvable, but something to design for rather than bolt on.<\/li>\n<li>For the court in Nevada, the question is narrower: not whether a perfect block exists, but whether Kalshi built in good faith toward a recognized standard, or merely claimed it had.<\/li>\n<li><strong>Note:<\/strong> Kalshi was contacted for the article but did not respond to questions.<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<p><a href=\"https:\/\/complianceandmore.substack.com\/p\/dont-fence-me-in\">Like what you are reading? CLICK here to read the FULL article!<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Oh, give me land, lots of land under starry skies above: Nevada\u2019s contempt application against Kalshi has put a narrow technical question at the center of the prediction market wars: can an operator build compliant geofencing in-house, on a $190,000 budget, or is that a category error? The argument was kicked off by Nevada, which&hellip;<\/p>\n","protected":false},"author":13,"featured_media":3235,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_seopress_robots_primary_cat":"none","footnotes":""},"categories":[25],"tags":[],"class_list":["post-3233","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-bettingjobs-complianceandmore-partnerships"],"acf":[],"post_author_name":"","post_authors_type":"","post_authors_from_team_members":false,"_links":{"self":[{"href":"https:\/\/www.bettingjobs.com\/af-api\/wp\/v2\/posts\/3233","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.bettingjobs.com\/af-api\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bettingjobs.com\/af-api\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bettingjobs.com\/af-api\/wp\/v2\/users\/13"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bettingjobs.com\/af-api\/wp\/v2\/comments?post=3233"}],"version-history":[{"count":2,"href":"https:\/\/www.bettingjobs.com\/af-api\/wp\/v2\/posts\/3233\/revisions"}],"predecessor-version":[{"id":3237,"href":"https:\/\/www.bettingjobs.com\/af-api\/wp\/v2\/posts\/3233\/revisions\/3237"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.bettingjobs.com\/af-api\/wp\/v2\/media\/3235"}],"wp:attachment":[{"href":"https:\/\/www.bettingjobs.com\/af-api\/wp\/v2\/media?parent=3233"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bettingjobs.com\/af-api\/wp\/v2\/categories?post=3233"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bettingjobs.com\/af-api\/wp\/v2\/tags?post=3233"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}