New York Sues Polymarket, Says It Ran Illegal Gambling Operation

New York’s attorney general sued Polymarket on Thursday, escalating her battle against prediction markets, an industry that she says violates state laws against illegal gambling.

Attorney General Letitia James filed her petition nearly two months after bringing a similar case against Polymarket rival Kalshi. She filed similar petitions in April against two other prediction market operators, Coinbase Financial Markets and Gemini Titan

James’ case against Polymarket is the latest effort by US states to crack down on an industry that has soared in popularity since faring better than pollsters in predicting that Republican Donald Trump would beat Democrat Kamala Harris in the 2024 presidential election.

Those states are also at odds with the Trump administration, with the Commodity Futures Trading Commission claiming exclusive authority to regulate prediction markets.

Federal appeals courts are divided over who should oversee the industry, raising the prospect the US Supreme Court may need to decide.

Prediction markets are best known for letting people wager through so-called event contracts on the outcomes of sports events, though people can also often wager on elections and cultural events such as the Oscars.

(Reporting by Jonathan Stempel in New York; Editing by Bill Berkrot)