According to a ChainCatcher report citing CoinDesk, Tennessee regulators have ordered Kalshi, Polymarket, and Crypto.com to stop offering sports betting contracts to residents of the state, accusing these companies of operating without the necessary licenses and violating the state's gambling laws. These companies are currently registered with the U.S. Commodity Futures Trading Commission (CFTC) as designated contract markets, allowing users to purchase contracts based on the outcomes of sports events. However, under Tennessee's Sports Betting Act, any entity accepting sports betting must hold a license issued by the state government. SWC stated that none of the three companies hold such licenses. "Therefore, the sports betting contracts offered... constitute betting as defined by the Act, which violates Tennessee state laws and regulations and is an illegal activity," the letter stated. The companies have been required to cease all business activities in Tennessee by January 31, cancel any outstanding contracts involving state residents, and refund all deposits. Failure to comply could result in civil penalties of up to $25,000 per violation and potential referral to criminal court for felony charges of promoting gambling (a felony under state law).
Tennessee Orders Kalshi, Polymarket, and Crypto.com to Halt Sports Betting Contracts
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Summary
Tennessee regulators have ordered Kalshi, Polymarket, and Crypto.com to cease sports betting contracts, citing concerns over CFT (Commodity Futures Trading) regulations and violations of state gambling laws. The companies, which hold licenses from the CFTC (Commodity Futures Trading Commission), are accused of operating without the required state licenses under the Tennessee Sports Wagering Act. They must stop all activities by January 31, cancel existing contracts, and refund all deposits. Failure to comply could result in $25,000 in civil penalties and potential criminal charges. The action underscores the growing regulatory pressure on liquidity and cryptocurrency markets.
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