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NY AG Sues Coinbase and Gemini Over Prediction Markets
New York's Attorney General sued Coinbase and Gemini for running unlicensed prediction markets, rejecting the idea that crypto products can sidestep gambling regulations.
What: New York Attorney General Letitia James filed lawsuits against Coinbase Financial Markets and Gemini Titan for running prediction markets—platforms where users trade on outcomes of events like sports and elections—without obtaining required licenses from the New York State Gaming Commission.
Why it matters: The suits explicitly reject the argument that crypto-native structuring can bypass traditional gambling regulation, potentially setting a precedent that could reshape how prediction markets operate in the United States.
Takeaway: If you're building prediction market features or similar betting products, ensure compliance with state gambling laws and licensing requirements, as crypto structuring may not provide regulatory shelter.
Decoder
- Prediction markets: Platforms where participants trade contracts based on the outcomes of future events, with prices reflecting collective probability estimates
- Disgorgement: Legal remedy requiring defendants to give up profits obtained through wrongful conduct
Original article
New York Attorney General Letitia James filed suits against Coinbase Financial Markets and Gemini Titan on April 21, alleging both platforms operated prediction markets without licenses from the New York State Gaming Commission in violation of state gambling statutes. The AG's office frames prediction market products as gambling under existing state law and the New York Constitution, bypassing any argument that crypto-native structuring exempts them from gaming regulation. The suits seek disgorgement of profits, restitution to users, and a prohibition on offering prediction products to anyone under 21.
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