Connecticut issued cease-and-desist orders to Kalshi, Robinhood, and Crypto.com, accusing them of facilitating unlicensed online sports gambling. At the same time, Polymarket reopened to US users and Fanatics launched prediction markets in 24 states, intensifying competition in the industry.

The platforms offer events contracts that allow users to bet on various outcomes, including sports-related contracts. Connecticut argues that these platforms lack the proper licenses to handle sports wagers and are not complying with state rules. If they don’t adhere to the shutdown order, penalties and charges may follow.

Kalshi claims its business is regulated by the Commodity Futures Trading Commission, enabling users to bet on US elections. However, several states dispute this claim and believe prediction markets should follow the same regulations as sportsbooks. Eight states have sent cease-and-desist letters to Kalshi, and Native American tribes have sued Kalshi and Robinhood.

Kalshi recently completed a $1 billion funding round, valuing the platform at $11 billion. Co-founder Luana Lopes Lara became the youngest self-made female billionaire at 29. Despite legal challenges, prediction-market trading amounted to over $3 billion in the third quarter alone, showcasing the industry’s potential for growth.

Read more at Yahoo Finance: State Regulators Bet on a Legal Difference Between Prediction Markets, Sports Gambling