New York sues Polymarket to shut down unlicensed crypto prediction market

The case widens New York’s campaign to treat prediction platforms as gambling, intensifying a power struggle with federal regulators.

New York Attorney General Letitia James and Governor Kathy Hochul have filed a lawsuit to shut down Polymarket’s US operation, accusing the crypto prediction market of running unlicensed gambling in the state. The complaint frames Polymarket as an illegal gambling business that exposes New Yorkers, including underage users, to betting products without state oversight. New York also argues that Polymarket avoids the tax and regulatory obligations imposed on licensed casinos and online sportsbooks, depriving state programs of related revenue. This case joins ongoing New York actions against other prediction platforms like Kalshi, Coinbase Financial Markets, and Gemini Titan, signaling a broader state-level push to treat prediction markets as gambling. The lawsuit lands amid a growing clash between states and the CFTC over who has authority to regulate prediction markets, with federal appeals courts issuing conflicting rulings.