Coinbase Faces Nevada Lawsuit as States Target Crypto Prediction Markets

Nevada regulators have stepped up action against crypto-linked prediction markets. A new lawsuit targets Coinbase over alleged unlicensed sports wagering. The move comes as prediction platforms expand quickly across the United States. State officials argue that existing gambling rules still apply, even when products are offered through crypto or derivatives markets.

Coinbase Hit With Nevada Lawsuit Over Sports Betting Contracts

The Nevada Gaming Control Board announced that it has filed a civil enforcement action against Coinbase Financial Markets, accusing the company of offering illegal wagers tied to sports event contracts. The filing was submitted on Monday in the First Judicial District Court in Carson City.

Regulators also asked the court to issue a temporary restraining order and a preliminary injunction that would block Coinbase from operating a derivatives exchange or prediction market linked to sporting outcomes within the state.

Mike Dreitzer, chair of the Nevada Gaming Control Board, said regulators acted to protect both the gaming industry and state residents. According to his statement, enforcement efforts are intended to preserve oversight of gambling activity and prevent unauthorized betting products from operating in Nevada.

The action followed closely on the heels of Coinbase’s announcement of the nationwide launch of prediction markets through its partnership with Kalshi. While Kalshi operates under federal oversight from the CFTC, state authorities maintain the power to challenge activity they believe violates local gambling laws. Nevada officials argue that federal supervision does not override state licensing requirements.

Concerns raised by regulators center on several key issues:

• The alleged offering of sports-related wagers without a Nevada gaming license.
• Risks to state authority over gambling supervision and enforcement.
• Blurred lines between financial contracts and traditional sports betting.
• Growing access for residents to unregulated, event-based markets.

Legal Pressure Mounts on Crypto Prediction Markets Across U.S. States

Nevada has taken similar steps against other platforms in recent weeks. Polymarket, another prediction market operator, was ordered by a state court to halt event-based betting services for Nevada residents. Judges agreed with regulators that the unlicensed activity caused immediate and lasting harm to the state’s ability to control gambling.

Legal pressure across multiple states is raising alarms within the crypto sector. Investors and operators worry that prediction markets may face mounting lawsuits unless lawmakers clarify how such products should be regulated. Ongoing disputes also raise the risk of tension between state regulators and federal agencies over final authority.

Some observers say these cases expose gaps in the current law. Prediction markets sit at the intersection of finance, technology, and gambling, leaving regulators struggling to fit them into existing frameworks. As more states review these platforms, companies like Coinbase could face costly legal battles across multiple jurisdictions simultaneously.