Key facts
- New York Attorney General Letitia James sued Polymarket, accusing it of operating an unlicensed gambling business.
- Polymarket counter-sued, asserting that the CFTC has exclusive authority to regulate prediction markets.
- The lawsuit is part of a broader state crackdown on similar platforms, including Kalshi, Coinbase, and Gemini.
- New York seeks to ban Polymarket's operations, recover gains, and impose fines.
New York Attorney General Letitia James sued Polymarket on Thursday, accusing the prediction market operator of running an unlicensed gambling business that puts New Yorkers at risk. Polymarket subsequently filed its own lawsuit against James and other state officials in Manhattan federal court, seeking to block state regulation of its prediction market. Polymarket asserts that the Commodity Futures Trading Commission (CFTC) has exclusive authority to regulate prediction markets. The state's action against Polymarket is part of a wider regulatory push against platforms deemed to be operating unlicensed gambling businesses, with similar actions previously targeting Kalshi, Coinbase, and Gemini.