City of Baltimore goes after prediction markets for sports betting
Reported by Cointelegraph · AI-assisted summary by ChikoCorp AI News Desk
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Summary
The City of Baltimore and Mayor Brendan Scott have filed lawsuits against prediction market companies Kalshi and Polymarket, alleging they operated illegal, unlicensed sports betting platforms and misled users about the legality of their products. The city claims that the contracts traded by these platforms constitute unlawful wagers under state law. The lawsuit against Kalshi also names Robinhood, Webull, and Coinbase as partners accused of deceptive marketing practices.
Why it matters
The lawsuits highlight ongoing legal conflicts between state authorities like Baltimore and federal regulators over the classification and regulation of prediction markets. Baltimore's action challenges the companies' claims that their event contracts are lawful and regulated federally, signaling possible shifts in enforcement and regulatory oversight that could impact market operations and user protections.
Key context
Prediction markets like Kalshi and Polymarket argue that their event contracts are “swaps” regulated by the federal Commodity Futures Trading Commission (CFTC), which maintains jurisdiction under federal law. Baltimore and other state authorities dispute this, asserting that such platforms engage in illegal sports betting under state gambling laws. This disagreement has led to broader legal debates expected to reach the Supreme Court.
Key numbers and entities
Involved entities include the City of Baltimore, Mayor Brendan Scott, prediction market platforms Kalshi and Polymarket, and partners Robinhood, Webull, and Coinbase. Michael Selig is noted as the Chair of the CFTC. No specific figures are provided in the source.
What remains unclear
The source does not flag any specific open questions but indicates uncertainty remains about how the legal conflict will be resolved, particularly whether federal or state authorities have ultimate jurisdiction over prediction markets. The outcome may depend on future court decisions, including potential Supreme Court appeals.