New York Attorney General Letitia James has sued Coinbase Financial Markets and Gemini Titan, arguing that their prediction market products amount to illegal gambling under state law. The lawsuits were filed in Manhattan and aim to block the platforms from operating in New York unless they obtain licenses from the New York State Gaming Commission.
The complaints argue that the two companies offered event contracts based on results in sports, elections and entertainment without the gambling licenses required in New York. They also argue that the platforms allowed users aged 18 to 20, even though New York’s minimum age for mobile sports betting is 21.
New York argues these products are still gambling
James argues that these contracts are gambling products because users put money on outcomes they cannot control, even if the platforms describe them as prediction markets. The attorney general is asking for money to be returned to users, for profits to be recovered, and for civil fines equal to three times the gains the state says were made from the businesses. The lawsuits also ask the court to stop access for under-21 users and to limit marketing on college campuses.
Lawsuits add to the wider legal fight over prediction markets
The cases arrive while courts and regulators across the US are still arguing over who should control prediction markets. Coinbase has argued that these products fall under federal oversight through the Commodity Futures Trading Commission, not state gambling regulators.
A recent federal appeals ruling supported Kalshi’s view that federal law gives the CFTC authority over event contracts. But New York and other states are still arguing that sports and similar contracts should count as gambling under state law.
New York is putting more pressure on the sector
The action against Coinbase and Gemini follows earlier pressure on other prediction market platforms. The new lawsuits show that New York is not treating crypto-linked prediction markets as something separate. The state is treating them as part of the same legal fight already unfolding around sports event contracts more broadly.
