Casino State Nevada Blocks 'Events-Based' Platform Polymarket, Court Ruling Shows

The 14-day temporary restraining order, issued at the request of the Nevada Gaming Control Board, prevents Polymarket from offering contracts to Nevada residents while the court considers a longer injunction. State regulators argue the platform’s markets amount to unlicensed sports betting under Nevada law. 

The ruling highlights the uneven regulatory terrain facing prediction markets at state level as demand grows around major political and sporting events. 

Polymarket only recently resumed serving US users after pulling back in 2022 following a settlement with the Commodity Futures Trading Commission (CFTC). 

The company has emerged as one of the largest players in prediction markets, which allow traders to place bets on elections, economic data and sports outcomes. Polymarket is seeking a valuation of up to $15bn amid fundraising efforts. 

CFTC oversight 

The move comes as the Commodity Futures Trading Commission (CFTC) prepares to rewrite the rulebook for prediction markets, according to a report by Bloomberg.  

CFTC Chairman Michael Selig reportedly on 29 Jan that the agency will draft new regulations for event-based contracts, pledging clearer rules as trading activity surges across platforms. 

Market growth and competition  

Polymarket is also facing mounting pressure from rivals as competition accelerates. Its largest US competitor, Kalshi, reported more than $9.5bn in notional trading volume in January, setting a new monthly record as activity surged around sports and major event contracts. 

Crypto exchange operator Coinbase has also moved into event markets accessible in all US states by partnering with Kalshi. The company has filed lawsuits against multiple states, including Michigan, Illinois and Connecticut, seeking federal court declarations that prediction markets under federal CFTC oversight are not subject to state gambling laws.  

Other crypto platforms, besides Coinbase, are also pushing into prediction contracts. Gemini, the exchange founded by the Winklevoss twins, has launched its own prediction market in the US. 

Crypto.com also introduced prediction contracts on Tuesday, timing the launch ahead of the Super Bowl, the National Football League’s championship game and one of the busiest periods of the year for event-based trading. 

Disputes over regulatory authority 

Kalshi has become the focal point of a growing legal fight between state gaming regulators and federal commodities oversight. The New York–based platform is registered with the CFTC as a designated contract market and argues that its event contracts fall exclusively under federal jurisdiction. 

That position has been challenged by several states. On 10 Jan, the Tennessee Sports Wagering Council sent cease-and-desist letters to Kalshi, Polymarket and Crypto.com, accusing the platforms of operating unlicensed sports wagering. According to regulators, the products violated state law, including restrictions on age limits and licensing requirements. 

Kalshi moved quickly to block enforcement. On 12 Jan, a federal judge in Nashville granted the company a temporary restraining order preventing Tennessee authorities from enforcing state laws against the platform. 

In court filings, Kalshi reportedly argued that Tennessee was attempting to regulate federally approved derivatives markets, an authority reserved for the CFTC. 

The company has engaged in litigation or regulatory disputes with at least eight states that have accused the platform of violating local gaming laws by allowing users to trade on sports outcomes without a licence.  

The US Congress is debating crypto and market structure legislation that could further clarify jurisdiction for such activities. Until then, state regulators and prediction platforms are effectively litigating the boundaries of federal power in real time.