The state of Connecticut fired a authorized volley towards sports activities occasions contracts with a trio of cease-and-desist orders despatched on Wednesday to main prediction-market operations — Robinhood, Kalshi and Crypto.com.
The state’s Division of Shopper Safety accused the businesses of “conducting unlicensed on-line playing, extra particularly sports activities wagering.”Every of the businesses are “hereby ordered to instantly stop and desist promoting, providing, selling, or in any other case making out there Contracts or every other type of unlicensed on-line playing to Connecticut residents,” in response to the state notices.
Robinhood argued on Wednesday that it is regulated by the federal authorities.
“As we have beforehand shared, Robinhood’s occasion contracts are federally regulated by the CFTC and supplied by Robinhood Derivatives, LLC, a CFTC-registered entity, permitting retail clients to entry prediction markets in a secure, compliant, and controlled method,” a spokesman for Robinhood mentioned in an emailed assertion.
Crypto.com did not instantly reply to requests for touch upon the letters.
“As different courts have acknowledged, Kalshi is a regulated, nationwide change for real-world occasions, and it’s topic to unique federal jurisdiction. It’s totally totally different from what state-regulated sportsbooks and casinos supply their clients. We’re assured in our authorized arguments and have filed go well with in federal courtroom,” Jack Such, a Kalshi spokesperson, mentioned in an announcement following the publication of this text.
“None of those entities possess a license to supply wagering in our state, and even when they did, their contracts violate quite a few different state legal guidelines and insurance policies, together with providing wagers to people underneath the age of 21,” mentioned Connecticut DCP Commissioner Bryan T. Cafferelli, in an announcement, which recognized three corporations as having eligibility to supply sports activities wagering within the state: Draft Kings (by way of Foxwoods), FanDuel (Mohegan Solar) and Fanatics (Connecticut Lottery).
The state mentioned failure to conform may end in civil or felony penalties.
Simply south of Connecticut, the state of New York can be in a authorized dispute with Kalshi over the identical challenge, and the crypto platform is suing the state over its place. Kalshi and Crypto.com are regulated by the federal Commodity Futures Buying and selling Fee as designated contract markets (DCMs). Kalshi has argued in its New York authorized problem that the state has no proper to intrude with that federal oversight.
Final month, a federal decide dominated in Nevada that state regulators have jurisdiction over a few of that state’s sports-based occasions contracts, doubtlessly threatening the business’s argument on this level. Kalshi, which was the corporate concerned in that case, was set to enchantment.
Polymarket, the largest crypto-native prediction market supplier, rolled out an app to greater than 20 U.S. states — additionally on Wednesday — because it prepares for a broader official relaunch within the U.S.
UPDATE (Dec. 3, 2025, 23:19 UTC): Provides Kalshi assertion.
