Ohio is treating sports event contracts on prediction markets as unlicensed sports betting. On 2 October 2026 the Ohio Casino Control Commission sent cease-and-desist letters to 10 platforms, including Coinbase, Polymarket, Robinhood and Underdog Predict, giving them until 16 October to stop serving Ohio customers. The move followed a 25 September Sixth Circuit ruling that Ohio can enforce its gambling laws against such contracts. Most platforms kept operating, arguing that only the federal CFTC regulates them, and Ohio's governor says the state will sue and seek to recover the money earned from Ohioans.
- Ohio sent cease-and-desist letters to 10 prediction market platforms on 2 October 2026, with a 16 October deadline.
- The Sixth Circuit ruled on 25 September that Ohio may enforce its gambling laws against sports event contracts; Kalshi already lost in court and faces a proposed $5 million fine.
- Most platforms kept operating; Plus500US said it would stop. Polymarket and Robinhood say only federal law applies.
- Ohio threatens criminal, civil and nuisance action and disgorgement of revenue earned from Ohio users, and says lawsuits are coming.
- With the Ninth and Sixth Circuits against Kalshi and the Third Circuit for it, the question is heading toward the US Supreme Court.
Ohio has moved from warnings to a direct confrontation with prediction markets. Fresh from a federal appeals court win, the state's gambling regulator ordered ten platforms to stop offering sports event contracts to Ohio residents. Most of them did not, and the state now says it will go to court.
The cease-and-desist letters
On 2 October 2026 the Ohio Casino Control Commission (OCCC) sent cease-and-desist letters to Coinbase, Gemini Titan, Moomoo Financial, Novig, Plus500US, Polymarket, ProphetX, Robinhood Derivatives, Underdog Predict and Webull Financial. Each was given 14 days, until 16 October, to confirm in writing that it had stopped serving Ohio customers with sports contracts.
The letters warn of administrative, civil, nuisance and criminal action. Offering unlicensed sports gaming is a felony in Ohio, and the commission says the contracts also amount to bookmaking or facilitating bookmaking. It can seek a civil penalty equal to the money a company took from Ohioans through the contracts, and it says it may pursue officers, directors and parent companies. Robinhood's letter reasserted a March 2025 order and names its joint venture with Susquehanna as well.
The court backdrop
Kalshi, the best-known sports contract exchange, was left off the list because it is already in litigation with Ohio. It sued the commission in 2025, lost its request for a preliminary injunction in March 2026, and in April the OCCC moved to fine it $5 million for unlicensed sports betting. On 25 September 2026 the Sixth Circuit ruled that Ohio can enforce its gambling laws against sports event contracts.
That ruling joins a growing split. The Ninth Circuit ruled against Kalshi in August 2026, while the Third Circuit sided with it. The core question is the same everywhere: does federal commodities law, which gives the Commodity Futures Trading Commission (CFTC) jurisdiction over contracts on registered exchanges, displace state gambling law for contracts that pay out on the result of a game? With appeals courts disagreeing, a US Supreme Court decision looks increasingly likely. We covered the federal-versus-state picture in our guide to crypto sports betting and prediction markets.
How the platforms responded
By the deadline, most platforms were still live in Ohio, some running ads during games. Plus500US told the commission it would stop offering sports contracts. Polymarket and Robinhood said the federal government, not the state, regulates them, and Kalshi said Congress created a single federal regulator for nationwide markets. The others did not respond publicly.
The economics explain the standoff. A licensed Ohio sportsbook goes through a licensing process that can cost more than $1 million, pays 20% tax on sports betting revenue and accepts only bettors aged 21 or over. A prediction market offering similar products under a CFTC framework does none of that, which is exactly why licensed operators and states are pushing back.
What comes next
Governor Mike DeWine has called the activity gambling and said the state plans to file lawsuits. Interim Attorney General Andy Wilson said Ohio will seek to recover the money the companies earned from sports contracts in the state. Ohio has also distanced itself from the National Council on Problem Gambling over its Kalshi partnership, leaving it in June; Michigan's gaming regulator has left it too.
Expect parallel tracks: state enforcement suits in Ohio courts, continued federal litigation over preemption, and pressure on Congress and the CFTC to settle the question. Until then, platforms that keep serving Ohio carry growing exposure to disgorgement claims.
What it means for operators
For licensed US sportsbooks and suppliers, the safe course is to avoid commercial ties with unlicensed prediction markets in states that object to them. Ohio has repeatedly warned its own licensees to end relationships with prediction market operators, and a state license is a far more valuable asset than a partnership with a platform under enforcement.
For businesses planning a prediction market or event contract product, market access must now be assessed state by state, not only at federal level. Our US gambling licensing guide sets out where sports betting is licensed and what each state requires, and our compliance team can review a launch plan before regulators do.
Frequently asked questions
Why is Ohio targeting prediction markets?
Ohio says sports event contracts are sports wagers. Ohio licenses sportsbooks, taxes them at 20% and requires bettors to be 21, and offering unlicensed sports gaming is a felony there. The prediction markets hold no Ohio license and follow none of those rules.
Which companies received Ohio cease-and-desist letters?
Coinbase, Gemini Titan, Moomoo Financial, Novig, Plus500US, Polymarket, ProphetX, Robinhood Derivatives, Underdog Predict and Webull Financial. Kalshi was not included because it was already in litigation with the commission.
What did the Sixth Circuit decide?
On 25 September 2026 the Sixth Circuit ruled, in the case brought by Kalshi, that Ohio can enforce its gambling laws against sports event contracts, rejecting the argument that federal commodities law shuts out state gambling law.
Are prediction markets legal in the United States?
Event contracts on CFTC-registered exchanges are regulated as derivatives at federal level, but whether states can treat sports contracts as gambling is contested. Federal appeals courts are split, which makes Supreme Court review likely.
What should licensed sportsbooks and suppliers do?
Keep clear of partnerships with unlicensed prediction markets in states that object to them. Ohio has previously warned its own licensees about such relationships, and a state license can be put at risk by association.
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Sources
- Focus Gaming News: Ohio escalates enforcement against prediction markets (opens in a new tab)
- Legal Sports Report: Ohio orders 10 prediction markets and brokers to stop sports event contracts (opens in a new tab)
- Ohio Capital Journal: Prediction market platforms ignoring Ohio's legal threats (opens in a new tab)
- Yogonet: Ohio orders 10 prediction market operators to stop sports contracts (opens in a new tab)