New York has filed suit against Coinbase and Gemini, accusing the crypto exchanges of offering unlicensed gambling through their prediction market products. The New York Attorney General’s office says the platforms’ sports, entertainment and election contracts operate like bookmaker-run bets — noting how the services were marketed, how users behaved on them, and describing participants in the complaints as “bettors” with “each contract” treated as a bet. The suits also allege the platforms permitted people aged 18–21 to wager, despite New York’s law barring mobile gambling for anyone under 21.
The complaint against Coinbase states plainly: “What Respondent offers through its platform is quintessentially gambling: It allows a bettor to stake or risk money upon the outcome of a contest of chance or a future contingent event not under the bettor’s control or influence, upon an agreement or understanding that he will receive something of value in the event of a certain outcome.”
New York is the latest in a wave of state enforcement actions. Nevada, Washington and several other states have sued prediction market providers, arguing at least sports-related contracts are bets not federally regulated swaps. Those disputes are now before multiple appeals courts and could ultimately be decided by the U.S. Supreme Court — a ruling that would clarify whether prediction markets fall under state gambling rules or federal oversight.
Coinbase’s chief legal officer, Paul Grewal, pushed back on X (formerly Twitter), arguing prediction markets are “federally regulated national exchanges” and saying Coinbase will defend the products under federal jurisdiction. The Commodity Futures Trading Commission (CFTC) — whose chair, Rostin Behnam, and other senior officials have maintained the agency has exclusive jurisdiction over prediction markets — has acted similarly, suing to block states such as Arizona, Connecticut and Illinois from bringing charges and seeking to intervene in a Nevada matter to defend providers.
Notably, Kalshi — one of the largest prediction market firms — was not named in New York’s filings. Kalshi previously preemptively sued the New York State Gaming Commission in the Southern District of New York, asking a federal court to rule that state gambling laws don’t apply to its platform; that case remains active.
New York Attorney General Letitia James criticized the products as “illegal gambling operations,” adding: “Gambling by another name is still gambling, and it is not exempt from regulation under our state laws and Constitution.”
UPDATE (April 21, 2026, 22:55 UTC): Gemini declined to comment.
Read more AI-generated news on: undefined/news
