In a significant legal development, a federal judge in Nevada has dismissed Crypto.com’s request for an injunction that would enable the platform to offer sports contracts within the state. Judge Andrew Gordon’s ruling comes as a surprise to many industry observers, particularly in light of the fact that Kalshi, another player in the prediction market space, has been granted permission to operate similar services.
The legal complications for Crypto.com began in June 2025 when the Nevada Gaming Control Board prohibited the company from engaging in sports outcome contracts. The Board classified these contracts as federally regulated swaps instead of gambling products, thus placing them under the jurisdiction of the Commodity Futures Trading Commission (CFTC).
During the recent hearings, Judge Gordon acknowledged that the CFTC holds jurisdiction over Kalshi’s operations but chose not to extend the same reasoning to Crypto.com. He differentiated Crypto.com’s sports prediction contracts by emphasizing that they focus on the outcomes of sporting events rather than merely their occurrence or non-occurrence.
Judge Gordon elaborated, stating, “I see ‘outcome’ as different than ‘occurrence, non-occurrence, or extent of contingency of occurrence.’ They’re just different things. If they were all the same, everything would be a swap, and that’s not what I think Congress intended or the CFTC intended.” This interpretation indicates that the contracts do not meet the qualifications of swaps under the Commodity Exchange Act (CEA).
Following the ruling, Crypto.com announced its intention to appeal Judge Gordon’s decision to the Ninth Circuit Court. This move suggests a continued commitment to contesting the regulatory landscape that has become increasingly contentious, particularly as the CFTC faces growing pressure from traditional sports betting operators to clarify the legal status of sports contracts.
As the landscape evolves, competition in the realm of sports contracts is intensifying. Other companies, such as Polymarket, are exploring avenues to introduce legal sports betting options, which has raised regulatory concerns but has not deterred their ambitions.
The outcome of these legal battles will be pivotal in shaping the future of sports contracts in the U.S., as stakeholders await clearer guidance from regulatory bodies on what constitutes legitimate betting versus speculative financial instruments.
