WHAT YOU NEED TO KNOW
  • New York sued Polymarket U.S., alleging the prediction market platform operates illegally without a state gambling license.
  • The state seeks three times Polymarket’s gains and $100,000 for each alleged sports wagering attempt or offer.
  • Officials also want records covering all trades, user losses and revenue earned by Polymarket U.S.
  • Polymarket rejected the allegations and said it would fight for its users while remaining in New York.

DISCLAIMER: GoldInvestors.news is not a registered investment, legal or tax advisor or broker/dealer. All investment/financial opinions expressed by GoldInvestors.news are from the personal research and experience of the owner of the site and are intended as educational material. Although best efforts are made to ensure that all information is accurate and up to date, occasionally unintended errors and misprints may occur.

New York State filed a lawsuit against Polymarket U.S. on Thursday, widening its regulatory battle with prediction market platforms. The action came nearly two months after the state sued Polymarket competitor Kalshi.

The lawsuit alleges that Polymarket operates an illegal gambling platform in violation of New York gambling laws. Among the state’s claims is that the company lacks a license from the New York State Gaming Commission.

Attorney General Letitia James accused the platform of avoiding state requirements while exposing residents to financial and social harm. Her office is seeking substantial penalties and a detailed accounting of activity conducted through the platform.

“By skirting New York’s laws, Polymarket is targeting the most vulnerable and depriving New York families of critical services and support,” James said in a statement announcing the state’s action.

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The lawsuit also claims Polymarket permits activity by users over 18. It cites a report from the New York State Office of Addiction Services and Supports describing people between 18 and 24 as being at “high-risk” of gambling addictions.

Governor Kathy Hochul similarly framed the dispute as a matter of public risk and state authority. She accused the company of knowingly violating New York law by operating without the required license.

“By running an unlicensed gambling operation, Polymarket has done more than just knowingly violate state law, they have put New Yorkers at risk, especially those underage who are most vulnerable to problem gaming,” Hochul said in a statement.

New York is asking the court to impose penalties that include three times the amount of any gains earned by Polymarket. The state also seeks $100,000 for each attempt or offer involving “sports wagering or mobile sports wagering” in New York.

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The requested relief goes beyond financial penalties. The lawsuit asks Polymarket U.S. to provide an account of every trade placed on the platform, the amount users lost and the amount the company earned.

Polymarket U.S. debuted in December 2025 and is regulated by the Commodity Futures Trading Commission. The federal agency regulates prediction market platforms, placing it at the center of a growing jurisdictional conflict involving the states.

The company also operates an offshore predictions platform founded in 2020. The Commodity Futures Trading Commission did not immediately respond to a request for comment regarding New York’s latest lawsuit.

The case is the latest development in what has become an escalating regulatory feud between state governments and prediction market platforms. The Commodity Futures Trading Commission has responded by suing several states and asserting its authority to regulate the markets.

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Polymarket rejected New York’s accusations and signaled that it intends to fight the action. The company emphasized its New York roots, its local workforce and its intention to remain in the state despite the attorney general’s lawsuit.

“Polymarket was founded in a tiny NYC apartment and now has more than 350 employees here, embodying why people and businesses come here to make it. We believe in New York and we’re staying here,” said Neal Kumar, the platform’s chief legal officer.

“While the AG’s decision to copy/paste a recycled lawsuit is disappointing, we’ll fight for our users,” Kumar added. His statement portrayed the case as a repeated legal attack rather than a new set of allegations.

The New York filing puts Polymarket alongside Kalshi in the state’s broader challenge to prediction market operators. CNBC disclosed that it has a commercial relationship with Kalshi that includes customer acquisition and a minority investment.

DISCLAIMER: GoldInvestors.news is not a registered investment, legal or tax advisor or broker/dealer. All investment/financial opinions expressed by GoldInvestors.news are from the personal research and experience of the owner of the site and are intended as educational material. Although best efforts are made to ensure that all information is accurate and up to date, occasionally unintended errors and misprints may occur.