City of Baltimore goes after prediction markets for sports betting
The city’s complaint over gambling laws and deceptive trade practices included Robinhood, Webull and Coinbase as partners with prediction market platform Kalshi.
The City of Baltimore has initiated legal action against prediction market platforms Kalshi and Polymarket, accusing them of operating unlawful sports betting operations without proper licensing. Mayor Brendan Scott emphasized that these companies are seeking to circumvent the law, stating that Baltimore will not allow such multibillion-dollar entities to profit from illegal gambling.
The city's complaint against Kalshi also named Robinhood, Webull, and Coinbase as partners, alleging they misled users about the legality and regulatory status of their products. The lawsuit claims that these companies marketed event contracts as lawful transactions, a claim Polymarket disputes. Both Baltimore and other states are contending that prediction market event contracts should be governed by federal law, not a patchwork of state laws.
The legal action represents a conflict between state and federal authorities, potentially leading to an appeal to the Supreme Court. While the CFTC contends that these contracts fall under its regulatory jurisdiction as "swaps," Baltimore and other states disagree.
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