New York sued prediction platform Polymarket on Thursday, alleging it operates illegal gambling without a state gaming license. The state asked a judge to stop its operations and impose financial penalties and order consumer restitution.
Prediction-market firms argue that state oversight is preempted by federal jurisdiction and that the Commodity Futures Trading Commission is the primary regulator. They describe contracts on future events as peer-to-peer trading, with prices set by trading and revenue from transaction fees. The CFTC did not immediately comment; states have brought similar actions against Kalshi, Coinbase and Gemini.
Gov. Kathy Hochul said the alleged unlicensed operation put New Yorkers, especially underage people, at risk. Polymarket chief legal officer Neal Kumar said the company would fight the suit and remain in New York, where it has more than 350 employees, according to his statement.
