Two days following a preliminary injunction issued by a Washington state court judge against Kalshi, the prediction market platform, Crypto.com’s event contract platform, OG, has filed a lawsuit in federal court against state officials.
The lawsuit, submitted on July 22 to the U.S. District Court for the Western District of Washington, seeks declaratory and injunctive relief from Washington Attorney General Nick Brown and members of the Washington State Gambling Commission (WSGC).
OG, introduced by Crypto.com in February as a sports-focused prediction market, aims to host markets for major sporting events, including the Super Bowl and March Madness, with a focus on parlay-style contracts.
Since late 2024, Crypto.com has been providing sports prediction markets through its app and has formed partnerships for event contracts with various gaming operators, such as DraftKings Predictions, Fanatics Markets, FanDuel Predict, and Underdog Predict.
In its complaint, Crypto.com argues that the Commodity Futures Trading Commission (CFTC) holds jurisdiction over federally registered markets, which, it claims, takes precedence over state gaming laws. The company states that it offers its event contracts in Washington under this authority but fears enforcement actions from state officials similar to those faced by Kalshi.
"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," the lawsuit asserts. It calls for a declaratory judgment and injunction to prevent what it describes as unlawful intervention by state authorities.
The lawsuit also cites an advisory from the WSGC in January that labeled prediction markets as "unauthorized activity" in Washington.
"Defendants have sought to enforce state gambling laws against Kalshi, another federally regulated exchange subject to the CFTC’s exclusive jurisdiction," the complaint stated. It alludes to the WSGC’s stated intentions to enforce regulation in this area, as well as Washington’s advocacy for state regulators regarding event contract litigation, including involvement as amicus curiae in a Ninth Circuit appeal where OG is an opposing party.
This pattern of seeking legal remedy in response to enforcement initiatives against prediction markets has emerged in Washington. Crypto.com is the second platform to take such legal action after the state initiated litigation against Kalshi.
On March 30, shortly after Washington’s lawsuit against Kalshi, its partner Robinhood filed a federal lawsuit against Brown and the WSGC, claiming a similar imminent threat to its operations. This strategy mirrors an earlier incident in Massachusetts, where Robinhood sued Attorney General Andrea Joy Campbell and the Massachusetts Gaming Commission following her state court action against Kalshi.
Additionally, last month, Polymarket also resorted to federal court by suing New Mexico Attorney General Raúl Torrez and the New Mexico Gaming Control Board, asserting that legal pressures were mounting due to New Mexico's lawsuit against Kalshi.
