Crypto prediction markets Polymarket, Kalshi, and crypto alternate Crypto.com are dealing with regulatory challenges because the Tennessee betting regulator has despatched cease-and-desist letters to the companies. This growth comes amid the talk of whether or not these prediction markets must also be categorized as conventional betting platforms.
Polymarket, Kalshi, Crypto.com Face Regulatory Scrutiny In Tennessee
Sports activities betting lawyer Daniel Wallach revealed in an X submit that the Tennessee Sports activities Wagering Council had despatched cease-and-desist letters to Polymarket, Kalshi, and Crypto.com. The regulator demanded that these crypto platforms instantly stop providing sports activities occasion contracts to Tennessee prospects, void all pending contracts, and problem refunds by January 31.
BREAKING: Tennessee Sports activities Wagering Council sends cease-and-desist letters to Kalshi (📸), Polymarket and Crypto, demanding that they stop providing sports activities occasion contracts to TN prospects instantly, void all pending contracts and problem refunds by Jan. 31. Lawsuits are imminent. pic.twitter.com/jDIPIwsrCn
— Daniel Wallach (@WALLACHLEGAL) January 9, 2026
The Tennessee Sports activities Wagering Council warned Polymarket, Kalshi, and Crypto.com that failure to adjust to their demand will lead to referral of the unlawful playing operations to regulation enforcement for additional investigation.
It’s price noting that that is the second cease-and-desist letter Kalshi and Crypto.com have acquired. CoinGape reported in December that the Connecticut Division of Shopper Safety (DCP) had issued cease-and-desist letters to Kalshi, Crypto.com, and Robinhood.
Kalshi already filed a movement for a preliminary injunction towards Connecticut’s order. Wallach revealed that Connecticut has filed an opposition to the movement, arguing that the prediction market can not present that it’s going to undergo irreparable hurt if it ceases its personal “illegal conduct.” As such, the state argues that public coverage weighs decisively towards Kalshi’s bid for an injunction.
Elevated Scrutiny On Prediction Markets
Tennessee’s cease-and-desist order towards Polymarket, Kalshi, and Crypto.com comes amid elevated scrutiny on prediction markets. As CoinGape reported, a Polymarket dealer made $400,000 by betting that Venezuela’s former President Nicolás Maduro could be out of workplace by January 31, simply earlier than the U.S. captured him.
This instantly raised allegations of potential insider buying and selling because of the timing of the guess. Moreover, that growth has led Congressman Ritchie Torres to introduce the ‘Public Integrity in Monetary Prediction Markets Act’, which can bar political insiders from betting on prediction markets.
Congresswoman Dina Titus has additionally expressed “critical considerations” about Polymarket’s means and willingness to adjust to CFTC rules following the betting exercise round Maduro’s arrest. She additionally despatched a letter to the agency’s CEO, Shayne Coplan, searching for solutions relating to the safeguards the corporate has in place to stop insider buying and selling and be certain that its market operates pretty and transparently.
In gentle of current betting exercise surrounding the seize of President Nicolás Maduro, I’ve critical considerations about @Polymarket’s means, and willingness, to adjust to @CFTC rules.
I’m demanding solutions from Polymarket CEO @shayne_coplan relating to the safeguards… pic.twitter.com/fHpjLpsykG
— Dina Titus (@repdinatitus) January 9, 2026
