New York Attorney General Letitia James has filed lawsuits against Coinbase Financial Markets and Gemini Titan, alleging that the two companies operate illegal gambling platforms through prediction markets available in New York.
Lawsuits claim Coinbase and Gemini allow users to bet on the outcomes of events including sports, entertainment awards, and elections. According to the complaint, these markets operate as gambling under New York law because users risk their money on uncertain outcomes beyond their control.
Attorney General James stated that the platforms operated without licenses from the New York State Gaming Commission. The state requires a license for gambling operations, including mobile sports betting. Lawsuits confirm this Coinbase and twin It did not obtain this approval while offering its products to users in New York.
The filings state that users between the ages of 18 and 20 can access the platforms. New York law sets 21 as the minimum age for mobile sports betting. The Attorney General’s Office says this access exposes younger users to financial risks and potential harm.
The complaints seek court orders requiring the companies to forfeit profits earned from prediction markets. The state is also seeking civil fines equivalent to three times those profits and compensation for affected users. The filings ask for limits on participation by users under the age of 21 and limits on marketing practices reaching campuses.
New York Attorney General: Prediction markets are a gamble
The lawsuits describe prediction markets as systems in which users trade contracts tied to the outcomes of events. The Attorney General’s Office argues that these contracts meet the legal definition of gambling because the results depend on chance or external events rather than the user’s control.
The filings cite research from the National Institutes of Health linking early exposure to gambling and increased… risk From anxiety, depression and financial distress. The lawsuits also cite research from the American Psychological Association indicating that a significant percentage of individuals with gambling disorders report suicidal ideation.
The complaints include allegations that the platforms allow betting on events involving college teams in New York, which is restricted by state law.
Coinbase and Gemini Fired Prediction markets in mid-December and are operating in all 50 states, according to court documents referenced in the filings. The Attorney General’s Office states that the platforms present themselves as financial products while operating as gambling systems.
The legal action forms part of a broader enforcement effort by New York authorities targeting online gambling and cryptocurrency-related platforms. The Attorney General’s Office has previously taken action against video game companies and lottery casino operators for alleged violations of state gambling laws.
The lawsuits also highlight ongoing regulatory disputes between state and federal authorities over prediction markets. The Commodity Futures Trading Commission has asserted federal jurisdiction over certain event-based contracts. Federal court cases have addressed whether state regulators can restrict such markets under gambling laws.
