New York sues Polymarket, alleging it is running an illegal gambling operation

New York’s attorney general and governor filed suit against Polymarket’s U.S. unit, QCX LLC, alleging the prediction market is functioning as an unlicensed gambling operation within the state. The complaint asks a court to prohibit Polymarket from operating in New York without a gambling license, to force the company to return alleged illegal profits to consumers, and to impose fines equal to three times those gains. The state’s filing contends that Polymarket’s contracts — which let users stake money on outcomes with uncertain results — constitute gambling under New York law. The suit also alleges the platform permitted users aged 18 to 20 to participate, while New York’s mobile sports betting rules require participants to be at least 21. Polymarket re-entered the U.S. market less than a year before the suit, rolling out markets that initially focused on sporting events and signaling plans to expand into other event types. A company spokesperson did not immediately respond to requests for comment on the litigation. The case joins a string of disputes between state regulators and prediction-market firms about whether those platforms are regulated by federal authorities — chiefly the Commodity Futures Trading Commission — or by state gambling statutes. New York previously sued rival Kalshi in July after talks with state officials broke down, seeking as much as $36 billion in penalties and disgorgement; that matter and other state cases have proceeded through appeals, and a related Kalshi-New Jersey case has reached the U.S. Supreme Court.