Coinbase is the latest company offering event contract trading to be sued by Nevada’s gaming regulator for allegedly offering unlicensed wagering in the state.
The Nevada Gaming Control Board (NGCB) filed a civil lawsuit against Coinbase Financial Market, Inc. in the First Judicial District Court for Carson City, seeking a permanent injunction and declaratory relief to prevent Coinbase from offering sports event contract trading in Nevada. Coinbase went live with sports prediction markets across the U.S. last week via a deal with Kalshi.
Coinbase offers event contract trading as a futures commission merchant (FCM) that is registered with the Commodity Futures Trading Commission (CFTC), the federal regulator of event contracts. That status enables it to host event contract trading, with designated contract markets (DCMs) serving as the suppliers of event contracts. Examples of DCMs that operate in the U.S. include Kalshi, Crypto.com and Polymarket.
NGCB wants to protect ‘general welfare’ of residents
In its suit, the NGCB alleged that Coinbase offers unlicensed wagering in Nevada, violating state law, as the regulator considers sports event contracts “wagering activity.” The NGCB requires all wagering providers to be licensed to ensure consumer protection and to undergo a rigorous licensing process.
“It is unlawful for any person to directly or indirectly receive any compensation or any percentage or share of the money played for accepting or facilitating any wager upon the result of any sporting event without a gaming license,” reads the NGCB’s suit.
As Coinbase is not licensed as a sports wagering operator, it is avoiding paying taxes on gross gaming revenue from the wagering activities it facilitates in Nevada, said the regulator. It added that the company does not have a physical wagering location in Nevada and allows individuals under the age of 21 to trade event contracts on its platform, which the NGCB said violates Nevada law.
“The gaming industry is vitally important to the economy of the state and the general welfare of the inhabitants,” continued the suit. “All establishments where gaming is conducted must therefore be licensed, controlled and assisted to protect the public health, safety, morals, good order and general welfare of the inhabitants of the state.”
The NGCB considers Coinbase’s sports event contracts “gaming,” subjecting them to regulation in the state, and the board also argues that Coinbase facilitates a “sports pool.” Nevada law defines a sports pool as “the business of accepting wagers on sporting events or other events by any system or method of wagering.” The NGCB claims Coinbase’s event contracts on college and pro sports meet the state’s requirements of hosting a sports pool.
Coinbase went on offensive elsewhere
Coinbase was sued by the NGCB after filing three lawsuits of its own last month.
The company filed in Connecticut, Michigan and Illinois, alleging that cease-and-desist orders sent by state regulators over sports event contracts compromise its planned business activities in those markets. Gaming regulators in those three states sent cease-and-desist orders to Kalshi, the company Coinbase works with to host event contracts.
In its suits, Coinbase says it expects the regulators to “imminently bring enforcement action.” The suits do not specify what enforcement actions regulators could take.
NGCB takes legal action against other prediction markets
Meanwhile, the NGCB is also suing Polymarket in Carson City state court over its sports event contracts, similarly seeking a declaration and injunction to prevent the platform from offering “unlicensed wagering” in Nevada. Earlier this week, a judge ordered Polymarket to stop offering event contracts in the state for a minimum period of two weeks, granting the NGCB’s request for a temporary restraining order (TRO).
Polymarket cannot offer event contracts until a hearing on the motion for an injunction is completed this month.
Kalshi is also facing legal action in Nevada federal court, but the company continues to operate in the state despite Judge Andrew Gordon rescinding a preliminary injunction he previously granted the prediction market last year. Gordon initially granted Kalshi a preliminary injunction and TRO in April 2025, allowing it to offer sports event contracts in Nevada, but reversed course in November by granting a motion from the NGCB to lift the injunction.
Coinbase and Kalshi’s fellow Coalition for Prediction Markets member Crypto.com was denied injunctive relief against the NGCB by Gordon and, as a result, pulled its event contracts from Nevada.
