Tennessee’s sports betting regulator has ordered prediction market platforms Kalshi, Polymarket and Crypto.com to stay the offering of sports occasion contracts to residents of the bid.
In terminate-and-desist letters dated Friday, the Tennessee Sports Wagering Council (SWC) accused all three platforms of illegally offering sports wagering merchandise without holding a license issued below the Tennessee Sports Gaming Act, per copies of the letters revealed on X by sports betting attorney Daniel Wallach.
The SWC acknowledged the sports occasion contracts listed on Kalshi, Polymarket and Crypto.com’s North American Derivatives Change allow users to wager money on the final end result of sporting occasions, a conference Tennessee law reserves completely for licensed sportsbooks. The regulator argued that packaging the merchandise as “occasion contracts” does now not exempt them from bid gambling statutes.
The regulator furthermore pointed to user security requirements imposed on licensed operators, including age restrictions, to blame gaming instruments and anti-money laundering controls, which it says are absent from the platforms’ choices.
Linked: How prediction markets lift insider buying and selling and credit ranking risks
Tennessee orders prediction markets to anguish refunds
The SWC ordered the companies to in an instant terminate offering sports-linked contracts to Tennessee residents, void all present contracts entered into by users within the bid and refund all funds on deposit by Jan. 31, 2026.
Failure to conform could perhaps well terminate in fines of up to $25,000 per offense, per the letters. The regulator furthermore warned that continued noncompliance could perhaps well lead on to injunctive relief and referrals to law enforcement for additional investigation into unlawful gambling operations.
Whereas Kalshi and Polymarket operate below federal commodities law and possess had dealings with the US Commodity Futures Procuring and selling Rate (CFTC), the SWC maintained that federal oversight does now not override Tennessee’s authority to alter sports wagering interior its borders.
Cointelegraph reached out to Kalshi, Polymarket and Crypto.com for commentary nevertheless had now not purchased a response by publication.
Linked: CFTC factors no-mosey letter to Bitnomial, clearing system for occasion contracts
Mediate expeditiously blocks Connecticut from enforcing recount in opposition to Kalshi
Final month, a US federal settle expeditiously barred Connecticut regulators from enforcing a terminate-and-desist recount in opposition to Kalshi, granting the firm a temporary reprieve because the becoming dispute moves forward. The recount follows mosey by the Connecticut Division of Client Safety, which accused Kalshi, Robinhood and Crypto.com of offering unlicensed sports wagering thru on-line occasion contracts.
Kalshi challenged the bid’s mosey in court, arguing that its occasion contracts drop below federal commodities law and are regulated completely by the CFTC. Mediate Vernon Oliver ruled that Connecticut must terminate enforcement while the court considers Kalshi’s search data from for a preliminary injunction, atmosphere time gash-off dates for filings in January and scheduling oral arguments for mid-February.
The case adds to a rising correct fight between Kalshi and bid regulators nationwide, as various states possess wondered whether or now not prediction market contracts tied to sports constitute unlawful gambling. Kalshi has launched complaints in opposition to regulators in Original York, Massachusetts, Original Jersey, Nevada, Maryland and Ohio.
Magazine: How crypto legal pointers modified in 2025 — and how they’ll alternate in 2026
Cointelegraph is dedicated to unbiased, transparent journalism. This data article is produced based fully on Cointelegraph’s Editorial Policy and objectives to provide correct and properly timed files. Readers are encouraged to envision files independently. Read our Editorial Policy https://cointelegraph.com/editorial-policy
