New York, Polymarket sue each other over whether prediction markets are illegal gambling | International
New York and Polymarket filed dueling lawsuits over whether prediction markets constitute illegal gambling under state law.Summary
New York Attorney General Letitia James sued Polymarket in state court, accusing the prediction market platform of operating without a gaming license, encouraging problem gambling among those under 21, and endangering New Yorkers' financial and physical health. New York Governor Kathy Hochul condemned the company for running an unlicensed gambling operation. Polymarket filed a counter lawsuit in federal court, arguing that the federal Commodity Futures Trading Commission (CFTC) has exclusive authority over prediction markets and that New York's demands create an impossible choice between complying with state regulators or preserving its federally protected nationwide operations. Polymarket's Chief Legal Officer Neal Kumar said the company tried to negotiate with state officials but "they preferred the media hit." New York's lawsuit seeks civil fines, forfeiture of illegal gains, and full customer restitution, while Polymarket's suit asks the court to declare New York's gambling laws unenforceable against the company. The dispute reflects broader tensions between US states and federal authorities over prediction market regulation, with federal appeals courts divided and the US Supreme Court potentially needing to weigh in. Polymarket, founded in 2020 and relaunched in the US last December after CFTC approval, has seen its valuation reportedly exceed $20 billion and has backing from 1789 Capital, a venture firm partnered with Donald Trump Jr. James views prediction markets as "quintessentially gambling" because users wager on uncontrollable outcomes and expect payouts, and has previously pursued similar cases against Kalshi, Coinbase Financial Markets, and Gemini Titan.
(Source：Devdiscourse)