New York AG Takes Legal Action Against Polymarket in Latest Gambling Enforcement Push

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Attorney General Letitia James filed a lawsuit against Polymarket on Thursday, claiming the platform operates as an unlicensed gambling business in violation of state regulations.
The legal action characterizes Polymarket’s prediction contracts as gambling activities under New York law.
The case represents the latest in a series of enforcement actions, with Kalshi, Coinbase, and Gemini facing comparable legal challenges in recent months.
State officials contend Polymarket permitted users aged 18 to 20 to participate, violating New York’s 21-year minimum age requirement for mobile wagering.
The prediction market platform expressed disappointment over the lawsuit, stating it preferred direct negotiations with state authorities.

The office of New York’s attorney general has initiated legal proceedings against Polymarket. The complaint was submitted Thursday to a state court located in Manhattan.

🚨BREAKING: New York SUES Polymarket over alleged illegal gambling operations, per Reuters.
New York Attorney General Letitia James says the platform violates state gambling laws, extending her crackdown on prediction markets after similar cases against Kalshi, Coinbase and… pic.twitter.com/WLsGuHR3cB
— Coin Bureau (@coinbureau) September 24, 2026

Letitia James contends that Polymarket operates as an unauthorized gambling enterprise. Her office maintains that the platform’s event-based contracts constitute wagering activities disguised through alternative terminology.

The attorney general has pursued similar enforcement actions previously. A comparable lawsuit targeting Kalshi was filed in July, while legal petitions against Gemini Titan and Coinbase Financial Markets were submitted in April.

Core Allegations in the Complaint

The four companies face identical fundamental accusations. State officials assert they conducted operations without obtaining required authorization from New York’s Gaming Commission.

The legal filing additionally highlights age-related compliance violations. While New York mandates a 21-year minimum age for mobile sports wagering, Polymarket allegedly permitted account access to individuals aged 18 and older.

James characterized this as a public health concern. She stated the platform exposes state residents to gambling dependency risks without adequate safeguards.

Governor Kathy Hochul added her perspective on the matter. She asserted that Polymarket deliberately violated state regulations and endangered residents, particularly younger participants.

The lawsuit seeks financial penalties from the platform. State authorities additionally want Polymarket to surrender illegally obtained revenues and provide restitution to impacted customers.

Company’s Official Statement

Polymarket expressed dissatisfaction with the legal action. Neal Kumar, serving as Chief Legal Officer, indicated the company initially attempted direct engagement with state authorities.

Kumar stated the platform proposed discussions regarding its user protection mechanisms. He noted that government officials opted for litigation rather than continued dialogue.

The company positions itself as the premier prediction market platform globally. Operations commenced in 2020.

The platform withdrew from United States markets for over three years. Polymarket resumed domestic operations last December following Commodity Futures Trading Commission authorization granted three months prior.

The platform also secured funding from 1789 Capital during the previous year. Donald Trump Jr. maintains partnership and advisory roles with both that investment firm and Polymarket.

State officials estimate Polymarket’s valuation exceeds 20 billion dollars.

Broader Regulatory Conflict

This litigation represents one element of ongoing tensions between state governments and federal oversight agencies. The CFTC has asserted exclusive jurisdiction over prediction market oversight.

Federal circuit courts have issued divergent opinions on this jurisdictional question. Legal analysts suggest the Supreme Court may ultimately need to provide definitive guidance.

New Jersey recently petitioned the Supreme Court to examine its dispute with Kalshi. That appeal could produce industry-wide precedent.

The high court has not announced whether it will hear the matter. Meanwhile, prediction market operators navigate contradictory state and federal regulatory frameworks.

The complaint filed Thursday referenced concrete instances from Polymarket’s application. One example concerned wagering on whether the Los Angeles Dodgers would defeat the New York Mets by more than 1.5 runs during a July matchup. The final score was 4 to 2 in favor of the Dodgers.

The state’s legal filing indicates officials may pursue measures to completely prevent New York residents from accessing the platform.