Connecticut Sends Cease-and-Desist Orders Affecting Sports Contracts on Nine Exchanges

Connecticut Gov. Ned Lamont’s administration escalated its marketing campaign to restrict the provision of sports activities occasion contract buying and selling for folks within the state on Thursday. The state’s Department of Consumer Protection despatched cessation calls for concerning sports activities occasion contracts to the operators of 9 exchanges together with Polymarket.

Lamont and different state officers are already concerned in a number of lawsuits over Connecticut’s playing legal guidelines and the standing of sports activities occasion contract buying and selling, each as complainants and defendants. These letters might elevate the stakes of these disputes and put higher emphasis on the United States Supreme Court weighing in on the problems.

Connecticut governor tells exchanges to dam entry to sports activities contracts

A Sept. 10, 2026 press release from Lamont’s workplace states that the recipients of the correspondence “are ordered to right away stop and desist promoting, providing, selling, or in any other case making accessible ‘sports activities occasion contracts’ or every other type of unlicensed on-line playing to Connecticut residents.” It provides that “failure to conform could lead to extra motion together with, however not restricted to, civil penalties underneath the Connecticut Unfair Trade Practices Act and/or legal penalties for violations of Connecticut’s gaming statutes.”

The 9 recipients are:

• Coinbase
• Crypto.com
• Gemini
• Novig
• Polymarket
• ProphetX
• Robinhood
• Underdog Predict
• Webull

This isn’t the primary time that Connecticut officers have insisted that sports activities occasion contract buying and selling qualifies as sports activities wagering underneath the state’s playing legal guidelines or that exchanges providing the exercise are in violation of these statutes. Connecticut Attorney General William Tong sued Kalshi on that exact premise in August.

Lamont, Tong, and different figures in Connecticut’s state authorities are a part of different disputes associated to this challenge. Their function in these different ongoing circumstances are that of defendants, although.

CFTC, Coinbase, Kalshi amongst events asking courts to dam Connecticut’s enforcement actions

Connecticut authorities have been the targets of lawsuits regarding enforcement efforts since December 2025 when Coinbase asked the US District Court for the District of Connecticut to enjoin these officers from taking such actions. Kalshi took the identical motion the identical month.

The US Commodity Futures Trading Commission (CFTC) followed with a similar complaint in the identical court docket in April 2026. At this time, all three disputes are pending court docket selections that would floor at any time.

The complainants in these circumstances have argued that Connecticut’s makes an attempt to implement its playing legal guidelines towards exchanges providing sports activities occasion contracts to merchants within the state violate the Supremacy Clause of the US Constitution, as federal regulation preempts state regulation of the contracts. They add that the contracts differ from playing as a result of they match the authorized definition of “swaps” underneath federal regulation.

At this time, there isn’t a court docket order both on the federal or state stage affecting the provision of sports activities occasion contracts in Connecticut. However, courts have additionally refused to face in the way in which of Connecticut officers taking actions like sending these cease-and-desist orders.

To what extent Polymarket and others select to adjust to the orders might rely on developments in these court docket circumstances. The nation’s highest court docket additionally bears watching on this regard.

US Supreme Court might give remaining phrase on nature of sports activities occasion contract buying and selling

While these occasions are unfolding, developments in Washington, D.C. might carry far more weight. The US Supreme Court has two petitions to assessment selections affecting prediction market exchanges and state governments.

Robinhood has asked for review of Kalshi v. Assad, wherein the US Ninth Circuit Court of Appeals has opined that sports activities occasion contract buying and selling is tantamount to playing and Nevada is inside its rights to implement its playing legal guidelines towards trade operators. New Jersey Attorney General Jennifer Davenport and New Jersey Division of Gaming Enforcement Director Mary Jo Flaherty have additionally requested the Supreme Court to assessment a choice from the US Third Circuit that enjoins them from doing the identical as authorities in Nevada.

The Supreme Court taking over both case would imply {that a} choice could be forthcoming which might settle the authorized questions in the entire disputes between Connecticut and trade operators. If the Supreme Court declines to assessment the rulings, although, the decrease courts will proceed to adjudicate the problems.

Lamont’s new batch of cease-and-desists sign that extra litigation may very well be forthcoming if the recipients select to not adjust to the orders. Given the already overtly litigious nature of this dispute, new filings appear a close to assure.

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