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Missouri Attorney General Orders Six Prediction Market Platforms to Stop Sports Contracts

Missouri Attorney General Catherine Hanaway gave six prediction market companies 30 days to stop offering sports event contracts to state residents or face enforcement action — the latest and broadest state-level crackdown in a year-long battle over who has the right to regulate a fast-growing industry.

The cease-and-desist letters, announced September 18, 2026, went to Polymarket, Kalshi, Crypto.com, Novig, Underdog, and Robinhood. Missouri becomes at least the 11th state to send such orders to prediction market operators, but its action stands out for the sheer number of platforms named and for the political weight behind it: the enforcement effort is rooted in a sports betting framework that Missouri voters themselves approved at the ballot box in 2024.

The Cease-and-Desist Orders: What Hanaway Demanded

Attorney General Hanaway announced her office had issued cease-and-desist letters to six companies, demanding they stop offering sports "event contracts" to Missourians unless and until they are licensed by the Missouri Gaming Commission.

"Missourians voted for a safe, well-regulated sports wagering market that supports public education and addresses problem gambling," Hanaway said. "Companies cannot repackage sports bets as 'event contracts' to avoid Missouri law. We will enforce the rules voters approved and protect consumers. Any company that wants to offer sports wagering in Missouri must be licensed by the Missouri Gaming Commission, pay the required taxes and fees, and ensure no one under 21 can place a bet."

Each company was given 30 days to comply. The deadline falls on October 18, 2026 — right in the middle of the NFL regular season. Failure to comply, Hanaway said, will result in enforcement action by the State of Missouri.

Missouri's Voter-Approved Sports Betting Framework

The enforcement action draws its legal authority from Amendment 2, a measure Missouri voters passed in November 2024 that legalized and regulated sports wagering in the state. The licensed market opened for business on December 1, 2025.

Under Amendment 2, the Missouri Gaming Commission oversees all sports betting operations. Licensed operators must pay a 10% tax on adjusted sports betting gross receipts and a five-year license renewal fee of up to $500,000. The framework also imposes strict age verification requirements — no one under 21 may legally place a sports wager in Missouri.

The state's licensed sportsbook market is already generating substantial revenue. Missouri's regulated sportsbooks handled an estimated $246.8 million in bets in July 2026, according to reporting from FairGambling, making it a meaningful market for both operators and the state's education funding stream.

Hanaway's office framed the prediction market operators as free riders: collecting revenue from Missouri residents while licensed operators pay taxes and comply with a regulatory framework voters chose.

Age Verification at the Heart of the Dispute

A significant portion of the cease-and-desist orders centers on age verification failures — a politically potent angle given Missouri's explicit constitutional requirement that no one under 21 can place a sports wager.

The attorney general's office said five of the six companies — Polymarket, Kalshi, Crypto.com, Underdog, and Robinhood — either permit underage users to access their products or lack adequate safeguards to prevent Missourians under 21 from participating in sports wagering. Novig was the one company not cited for age verification deficiencies, though it received a cease-and-desist order on the unlicensed-operation grounds shared by all six.

The age verification focus matters strategically. It shifts the legal debate beyond the federal preemption fight — where outcomes are uncertain — toward consumer protection ground where state authority is well established. A state's power to set a minimum gambling age has never seriously been contested in federal court.

Platforms Push Back: The Federal Preemption Defense

The six companies are unlikely to quietly comply. Their consistent defense is that sports event contracts are federally regulated financial products under the Commodity Exchange Act (CEA), not state-regulated gambling.

A Polymarket spokesperson responded to the cease-and-desist by reiterating that position: "Polymarket US maintains that prediction markets are regulated by the Commodity Futures Trading Commission under a federal framework, not a patchwork of state rules."

A Robinhood spokesperson said the company's event contracts are regulated by the CFTC and offered through a CFTC-registered arm. Robinhood operates its own CFTC-licensed exchange, Rothera Exchange and Clearing LLC, alongside its Kalshi partnership.

Hanaway rejected this framing directly in the cease-and-desist letters. Her office argued that federal courts have held that online sports wagering platforms — including those structured as event contracts — remain subject to state gambling laws. "Federal law does not preempt state law in this area," the letters stated, "and sports event contracts do not qualify as 'swaps' governed by the federal Commodity Exchange Act, as frequently claimed by illegal online sportsbooks."

The platforms' CFTC-regulated status is real but contested in this context. Kalshi is a fully licensed CFTC Designated Contract Market (DCM) and Derivatives Clearing Organization (DCO). Polymarket US operates through QCX LLC, a CFTC-licensed DCM. Novig operates as Ludlow Exchange LLC, a CFTC-licensed DCM approved in June 2026. Being CFTC-registered does not, in the Missouri AG's view, exempt these companies from state licensing requirements for sports wagering.

What the Federal Courts Have Said — So Far

The federal preemption question is the defining legal issue in the prediction market industry right now, and the courts are pointing in opposite directions.

On April 6, 2026, the Third Circuit Court of Appeals — which covers Pennsylvania, New Jersey, and Delaware — ruled that the CFTC's authority over sports event contracts is exclusive, blocking New Jersey from enforcing its gambling laws against Kalshi. That ruling is the industry's strongest legal precedent.

But on August 28, 2026, the Ninth Circuit Court of Appeals reached a different conclusion, declining to block Nevada from enforcing its gambling laws against Kalshi. The Ninth Circuit's decision — covering Nevada, California, Arizona, and other western states — directly conflicts with the Third Circuit's ruling.

Missouri sits in the Eighth Circuit, which has not yet ruled on prediction market jurisdiction. If Missouri follows through with enforcement action and Kalshi or another platform sues to block it, the Eighth Circuit would be the next court to weigh in on a circuit split that is increasingly looking like a case for the Supreme Court.

Underdog has already sued five states to block their enforcement actions, betting that federal courts will extend the Third Circuit's preemption logic to other circuits.

Missouri Joins a Growing Wave of State Pushback

Missouri is not acting alone. Officials in at least 11 states have sent cease-and-desist orders to prediction market companies, and active litigation has played out in at least eight states, according to Stateline, a nonprofit news organization covering state policy.

The American Gaming Association — the trade group representing licensed sportsbooks like DraftKings and FanDuel — has argued that prediction market platforms are offering sports betting nationwide while evading the state and tribal regulatory frameworks that licensed operators accept. The AGA has estimated that prediction markets diverted more than $570 million in sports gambling tax revenue since prediction markets entered the space, and that platforms cost states roughly $250 million in local tax revenue in 2025 alone.

Missouri's action is notable in context for several reasons:

Breadth of targets. Six companies named in a single announcement is unusually comprehensive. Earlier C&D actions from states like Michigan and Connecticut typically named two to four operators.

Infrastructure diversity. The six companies named operate across multiple infrastructure layers: Kalshi (own DCM/DCO), Polymarket US via QCX LLC (CFTC DCM), Robinhood via Rothera (own DCM/DCO) and Kalshi, Crypto.com via its CDNA exchange, Underdog via Aristotle Exchange (DCM/DCO acquired March 2026), and Novig via Ludlow Exchange LLC. Every major US prediction market infrastructure provider is now named by at least one state.

Voter mandate backing. Missouri's enforcement is not just an AG decision — it rests on a constitutional amendment approved by Missouri voters. That gives Hanaway more political cover and makes a legislative override nearly impossible.

What Happens Next: The October 18 Deadline

The 30-day compliance clock is now running. Each of the six platforms faces a decision: geofence Missouri users, seek a negotiated standstill like Kalshi achieved in Montana, or wait for the state to initiate enforcement proceedings.

Kalshi negotiated a standstill agreement with Montana officials in September 2026 — under which Montana agreed to pause enforcement while the Ninth Circuit case played out. A similar arrangement in Missouri is possible, but it requires both sides to agree.

The Missouri Gaming Commission has signaled it is watching but not rushing to act. "The MGC will await the outcome of several court cases at the federal and state levels to help determine action or inaction by the agency in the future," said Elizabeth Hoffman, a Gaming Commission spokesperson, in a statement to ABC 17 News. "We do believe there is an impact of prediction markets on sports wagering revenue; however, because they are not regulated, we have no idea what level that would be."

The CFTC, which regulates Kalshi, Polymarket US, and other platforms at the federal level, has not formally weighed in on Missouri's action. That dynamic — state AG enforcing gambling law, federal regulator defending event contracts — remains unresolved at the national level.

For prediction market users in Missouri, the practical implication is that access to sports event contracts may change before October 18 if platforms choose to geofence the state proactively. Users should monitor platform announcements as the deadline approaches.

How to Follow These Markets on PredictionMarkets.US

PredictionMarkets.US tracks live odds across Kalshi, Polymarket, and other platforms. To see where prediction market users are pricing the outcome of the national legal battle over sports event contracts — including markets tied to regulatory legislation — visit predictionmarkets.us/events.

Frequently Asked Questions

What did Missouri's attorney general order? Missouri Attorney General Catherine Hanaway issued cease-and-desist letters to six prediction market companies on September 18, 2026 — Polymarket, Kalshi, Crypto.com, Novig, Underdog, and Robinhood — ordering them to stop offering sports event contracts to Missouri residents without a state sports wagering license.

Why does Missouri have the authority to do this? Missouri voters approved Amendment 2 in November 2024, creating a licensed sports wagering framework overseen by the Missouri Gaming Commission. The AG's office argues that prediction market sports event contracts constitute sports wagering under Missouri law and are therefore subject to the state licensing requirements voters approved.

What do the platforms say? The platforms argue that their sports event contracts are federally regulated financial products under the Commodity Exchange Act, governed by the CFTC rather than state gambling laws. Polymarket said it operates "under a federal framework, not a patchwork of state rules." Robinhood said its contracts are CFTC-regulated.

What is the compliance deadline? Each company was given 30 days to comply, making the deadline October 18, 2026. Failure to comply may result in enforcement action by the State of Missouri.

Has any federal court ruled on this issue? Yes — and they have disagreed. The Third Circuit Court of Appeals ruled on April 6, 2026 that CFTC authority over sports event contracts is exclusive, blocking New Jersey's enforcement. But the Ninth Circuit ruled on August 28, 2026 that Nevada can enforce its gambling laws against Kalshi. Missouri is in the Eighth Circuit, which has not yet ruled on the question.

Which prediction market platforms are affected? The six platforms named are Polymarket (via QCX LLC), Kalshi, Crypto.com (via its CDNA exchange), Novig (Ludlow Exchange LLC), Underdog (via Aristotle Exchange), and Robinhood (via Rothera Exchange and Kalshi). These cover the major CFTC-regulated US prediction market infrastructure providers.

The Bottom Line

Missouri's cease-and-desist action is the broadest single-day state enforcement sweep against prediction markets to date. With the political cover of a voter-approved constitutional amendment, a 30-day deadline that falls during peak NFL season, and six platforms covering every major US prediction market infrastructure provider, it signals that state-level enforcement is accelerating — not slowing — despite the split in federal appeals courts.

The next major legal developments to watch: whether Underdog or another platform files for a federal injunction in Missouri's Eighth Circuit, whether the CFTC responds publicly to the state's action, and whether the platforms choose geofencing or a standstill negotiation before October 18.

For traders and bettors who use prediction markets in Missouri, this is a story worth following closely. The regulatory landscape for these platforms has never moved faster, and it is not done moving.