Missouri Hits Polymarket and Kalshi With Cease-and-Desist Orders

Missouri Sends Cease-and-Desist Letters to Prediction Market Platforms

Missouri is targeting prediction marketplace platforms that connection sports-linked lawsuit markets.

Missouri Attorney General Catherine Hanaway announced that her bureau sent cease-and-desist letters to respective companies operating platforms that fto Missourians entree these sports lawsuit contracts—elements that her bureau considers amerciable nether authorities law.

Polymarket, Kalshi, Crypto.com, Novig, Underdog, and Robinhood person been affected by these actions, arsenic Hanaway labeled the proviso of these services arsenic operating an unlicensed sports wagering business.

In the letters sent to these lawsuit marketplace operators, Hanaway claims that they person sought to debar complying with akin sports gambling laws of different states by claiming that they connection “event contracts”—or alleged “swaps”—governed by the Commodity Exchange Act (CEA) and taxable to exclusive regularisation by the Commodity Futures Trading Commission (CFTC).

Nonetheless, Missouri contests this assumption, supported by respective national tribunal rulings that person decided that these bets bash not suffice arsenic “swaps” and flight CFTC oversight. The letters besides accent that failing to comply with authorities laws has caused economical damages to Missouri, arsenic the platforms person not paid licence fees nor the 10% wagering taxation that applies to adjusted gross gross of each in-state sports wagering.

“Missourians voted for a safe, well‑regulated sports wagering marketplace that supports nationalist acquisition and addresses occupation gambling. Companies cannot repackage sports bets arsenic ‘event contracts’ to debar Missouri law. We volition enforce the rules voters approved and support consumers,” said Hanaway.

Prediction markets platforms volition person 30 days to halt offering sports-based lawsuit contracts successful the state, oregon hazard facing enforcement actions.

Missouri’s enactment is the latest successful a bid of actions that person pitted states against prediction marketplace platforms connected whether sports lawsuit markets bash represent gambling products. On September 2, New Jersey directed a petition to the Supreme Court to find whether national instrumentality preempts states “from regulating sports bets that hap wrong their jurisdictions if those bets are offered connected markets registered with the Commodity Futures Trading Commission.”

While states person pushed back against the CFTC connected the matter, the committee has reiterated that it retains exclusive oversight implicit these contracts. “To immoderate authorities that seeks to nullify national instrumentality and prehend authorization implicit these markets, I accidental again: We volition spot you successful court,” said Chairman Michael S. Selig successful April.