Two days after a Washington state court judge issued a preliminary injunction against Kalshi to stop the prediction market platform from offering sports event contracts, Crypto.com’s event contract platform OG sued state officials in federal court.
In a July 22 lawsuit filed in U.S. District Court for the Western District of Washington, Crypto.com-owned North American Derivatives Exchange (Nadex), doing business as OG, asked the court to grant declaratory and injunctive relief against Washington Attorney General Nick Brown and Washington State Gambling Commission (WSGC) members.
OG is the sports-focused prediction market brand and platform unveiled by Crypto.com in February. The company said at the time of the announcement that it will host markets on major sporting events such as the Super Bowl and March Madness, and that parlay-style combination contracts will be included.
Crypto.com claims ‘concrete and imminent threat’ in Washington
Crypto.com has offered sports prediction markets on its native app since late 2024. It holds event contract partnerships with several gaming operators, including:
Its July 22 Washington complaint hinges on the familiar argument that the Commodity Futures Trading Commission’s jurisdiction over federally registered markets supersedes state gaming laws. The company alleges that while it offers its event contracts in Washington under that authority, it is at risk of facing similar enforcement action from state officials.
“The threat of Defendants’ enforcement of Washington law poses a direct and imminent threat to OG’s business and its users and disrupts the comprehensive federal framework that places OG exclusively under the CFTC’s supervision,” reads the lawsuit. “A declaratory judgment and injunction are necessary to prevent Defendants’ unlawful intrusion into a market which they have no legal authority to regulate.”
The lawsuit also referenced the WSGC’s public advisory in January that branded prediction markets “unauthorized activity” in the state.
“Defendants have sought to enforce state gambling laws against Kalshi, another federally regulated exchange subject to the CFTC’s exclusive jurisdiction,” added Crypto.com’s OG. “This action is consistent with Defendants’ public statements evincing an intent to enforce, WSGC’s formal guidance declaring prediction markets ‘unauthorized’ in Washington, and Washington’s multijurisdictional advocacy in support of state regulators in event contract litigation, including as amicus curiae in a Ninth Circuit appeal in which OG is an opposing party.
“Thus, there is a concrete and imminent threat that Defendants will take the same actions against OG as they did against Kalshi.”
Familiar pattern of prediction market response
Crypto.com is the second prediction market platform to sue Washington in direct response to developments in the state’s litigation battle with Kalshi.
On March 30, the first working day after Washington initially sued Kalshi in state court, Kalshi partner Robinhood sued Brown and the WSGC in federal court, claiming that it faced an imminent threat of enforcement action that would cause “irreparable harm” to its own operations.
That replicated what happened in Massachusetts, when Robinhood sued AG Andrea Joy Campbell and the Massachusetts Gaming Commission last September, soon after Campbell filed a state court lawsuit against Kalshi.
Meanwhile, last month, Polymarket filed a federal court lawsuit against New Mexico AG Raúl Torrez and the leadership of the New Mexico Gaming Control Board, stating that its hand was forced by the “immediate threat” implied by New Mexico suing its competitor Kalshi a few weeks earlier.
