Nevada has won another victory in a legal flight in state court against the prediction market industry.
Similar to a previous rulings against Kalshi and Polymarket, Nevada state court on Friday issued a preliminary injunction barring Coinbase from offering sports, election, and entertainment wagering within the state. The ruling said the prediction market operator, which claims its authority under the Commodity Exchange Act and regulated by the Commodity Futures Trading Commission, isn’t preempted from following Nevada’s gaming laws.
On March 20, Judge Jason Woodbury issued a temporary restraining order barring Kalshi from offering wagers on sports, politics, and entertainment in Nevada and scheduled an April 3 hearing for a preliminary injunction that he says “has a reasonable likelihood of success on the merits.” He said the injuries to Nevada are “irreparable and non-compensable” and that the Board is unable to protect underage people from wagering and the integrity of competition, as is currently done by licensed sportsbooks.
In Friday’s ruling by Judge Kristin Luis, Coinbase has 60 days to make “technological enhancements” to comply with the order.
Kalshi has been screening based on residency of its customers rather than a geofence. That has meant people who are in Nevada who have an out-of-state address listed in their account can still gamble.
Judge Luis granted a TRO in the Coinbase case on Feb. 2. Woodbury granted a TRO against Polymarket in January.
Florida gaming attorney Daniel Wallach said the case signifies that Nevada has “become the most proactive state, using state-court enforcement remedies, to force these sites out of (Nevada).”
States have figured out that the most expedient path for enforcement was through their state court systems.
“That was a game changer for the states, and Nevada is a shining example of states using their civil enforcement remedies preemptively, other than being dragged involuntarily into the court,” Wallach said.
Overall, states have won 13 out of 15 court cases across the country, Wallach said. He expects Coinbase to appeal through the Nevada state court system.
