New York Sues Polymarket Over Alleged Illegal Gambling Operation

New York Attorney General Letitia James is suing prediction markets platform Polymarket, claiming its sporting event contracts break state gambling laws. State officials filed the case on Thursday. The filing points to Polymarket’s sports contracts on its mobile app, which launched in December 2025, along with its advertising to New Yorkers. Officials could also seek to block the platform for state residents.

The filing argues that Polymarket tries to dodge the legal and financial consequences of New York’s close regulation of gambling by offering what is essentially wagering under the label of “event contracts” on a “prediction market.”

Earlier Cases Against Prediction Markets

This is not the first move of its kind. The state filed a similar lawsuit against Kalshi in July, alleging an illegal gambling operation. In April, it also took legal action against the prediction market platforms run by Coinbase and Gemini.

Prediction Market Regulation: State vs Federal Authority

The case adds to a growing clash between state authorities and federal agencies over who oversees prediction markets. Michael Selig, chair of the US Commodity Futures Trading Commission, has said the agency holds “exclusive jurisdiction” over these companies.

Supreme Court Petition in the Kalshi Case

Earlier this month, New Jersey officials asked the US Supreme Court to hear their case against Kalshi, hoping for a ruling that could clarify who should regulate the industry. The court has not yet said whether it will take the case