Crypto.com and Novig Sue Missouri Over Sports Event Contracts as Rivals Hold Off

Two of the six companies ordered by Missouri’s attorney general to stop offering sports event contracts have gone to federal court. Crypto.com’s prediction market exchange and Novig filed suits on Friday, asking judges to block the state from enforcing its sports wagering laws against their products as the cease and desist deadlines ran out. Kalshi, Polymarket, Robinhood and Underdog received the same letters in September, but court records reviewed as of Sunday show none of them has sued in either of Missouri’s federal districts. The four firms did not immediately respond to requests for comment.

Missouri Attorney General Cease and Desist Orders

Attorney General Catherine Hanaway sent the letters on September 16 and 17. Each operator had 30 days to stop offering sports event contracts to Missourians or obtain a license from the Missouri Gaming Commission, which has overseen legal sports wagering since voters approved it in November 2024, and pay the state’s 10% wagering tax. The letter to Crypto.com also pointed out that the platform allows users as young as 18, while Missouri’s minimum betting age is 21. Hanaway said companies cannot repackage sports bets as event contracts to dodge state law.

Crypto.com and Novig Court Arguments

The North American Derivatives Exchange, the CFTC-registered exchange behind Crypto.com’s platform, filed in the Western District of Missouri. It argues the Commodity Exchange Act gives the CFTC exclusive jurisdiction and preempts state gambling law, and it seeks a declaratory judgment and a permanent injunction. The complaint also says the letter was wrongly addressed to Foris DAX, Inc., and that a license is not realistic because Missouri’s constitution allows only two direct mobile sports wagering licenses, both already awarded.

Novig, which has also sued officials in other states including Wisconsin, filed in the Eastern District through its exchange operator, Ludlow Exchange LLC. It wants a preliminary and permanent injunction to preserve the status quo while the 8th Circuit, which covers Missouri, hears an appeal on the same question in a Kalshi case from Iowa.

Federal Appeals Courts Split on Prediction Markets

Federal appeals courts remain divided on whether federal law overrides state gambling rules for sports event contracts. The 6th and 9th Circuits ruled against Kalshi, while the 3rd Circuit sided with it. Kalshi was the first of the six companies to respond to Hanaway, and her office described ongoing discussions with it, according to an October 2 report. Underdog sued Connecticut last month over a similar crackdown but has not taken Missouri to court.