Crypto.com and Novig are suing Missouri officials over efforts to restrict their sports event contracts
Prediction market platforms Crypto.com and Novig are suing Missouri state officials in federal court, seeking to prevent the state from enforcing its sports betting laws against their sports event contracts.
The lawsuits were filed on Friday as 30-day deadlines expired for six prediction market operators ordered by Missouri Attorney General Catherine Hanaway to stop offering sports event contracts or obtain state authorization.
Crypto.com’s exchange operator, North American Derivatives Exchange, filed its lawsuit in the Western District of Missouri. It argues that the Commodity Exchange Act gives the Commodity Futures Trading Commission (CFTC) exclusive jurisdiction over its contracts.
Novig’s operator, Ludlow Exchange LLC, filed its case in the Eastern District of Missouri, seeking preliminary and permanent injunctions, while the Eighth Circuit Court of Appeals considers a related dispute involving prediction market platform Kalshi in Iowa.
Crypto.com and Novig both received cease-and-desist letters in September, along with operators Kalshi, Polymarket, Underdog and Robinhood.
None of the other companies have filed lawsuits in either federal court district so far, although reports suggest that Kalshi has been in discussions with the Attorney General’s office.
The letters stated that the companies had 30 days to either stop offering sports events contracts in Missouri or to apply for a license with the Missouri Gaming Commission.
The Attorney General also highlighted that Crypto.com allows users as young as 18 to trade contracts, while the state’s minimum age for legal sports betting is 21.
The lawsuits are the latest developments in a wider argument over whether prediction market operators should be regulated at the state or federal level.
So far, federal appeals courts have reached differing conclusions. The Sixth and Ninth Circuits have ruled against Kalshi in related cases, while the Third Circuit has sided with the prediction market operator.