Nevada once again cautions operators not to engage in sports event contracts

• Nevada warns sports betting and gaming licenses to refrain from offering sports event contracts
• Kalshi recently suffered a setback in the state and has been ordered to stop offering such markets
• All over the United States, legal challenges emerge as businesses are doubling down on the segment

Following the exit of DraftKings and FanDuel from the state of Nevada over concerns that hawkish local regulators may hinder the companies’ expansion into prediction markets. With Nevada growing increasingly belligerent against the sector as a principle, America’s betting behemoths have seen it fit to exit the Silver State.

NGCB reiterates its warnings against prediction markets that involve sports

Now, the Nevada Gaming Control Board (NGCB) has issued a new reminder to licensed operators in the state not to engage in sports event contracts, which the watchdog argues are an unlicensed form of sports gambling.

The warning comes amid a fraught legal context, with a federal judge recently ruling against Kalshi’s and ordering the company to stop offering sports event contracts in the state. Kalshi and others, such as Crypto.com and Robinhood, have repeatedly argued that the sports event contracts they run are subject to regulation by the Commodity Futures Trading Commission and lie beyond the remit of state regulators.

The NGCB, Missouri Gaming Commission, and many others, though, have pointedly disagreed. The attorney general of Massachusetts has also joined the criticism of these platforms. Kalshi is also facing a class-action lawsuit in the United States, which specifically seeks to dismantle its defense, i.e., that the company is not offering sports betting products.

Industry giants remain unflinching in the face of a churning regulatory pushback

To the contrary, claims the complaint, arguing that Kalshi is using its financial services status to offer unregulated sports gambling, citing the high volume of trades realized in this particular vertical. Kalshi has repeatedly denied this. As to Nevada, the NGCB stated:

"Offerings for Sports and Other Events Contracts may be conducted in Nevada only if the offering entity possesses a nonrestricted gaming license with sports pool approval in Nevada and meets the other requirements for sports wagering, including, without limitation, wagering accounts and sports book systems."

Pushback against prediction platforms is intensifying at a time when Polymarket is making a return to the United States, and others are doubling down on the vertical.

FanDuel and DraftKings have notably outlined their own plans to pursue the vertical, suggesting that sports event contracts are here to stay. Underdog cancelled its launch in Missouri at the last moment as well.

The legal battles and regulatory scrutiny continue, nevertheless.

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