Crypto.com and Novig Sue Missouri Over Sports Event Contracts Crackdown
Two of the six prediction-market and sports-exchange companies that Missouri's attorney general ordered to stop offering sports event contracts have taken the state to federal court. North American Derivatives Exchange — the CFTC-registered exchange behind Crypto.com's prediction markets platform — filed suit in the Western District of Missouri, while sports-betting exchange Novig filed through its exchange operator, Ludlow Exchange LLC, in the Eastern District of Missouri. Both suits were filed Friday, October 16, the same day a 30-day compliance deadline set by the state expired.
What triggered the lawsuits
Missouri Attorney General Catherine Hanaway sent cease-and-desist letters on September 16 and 17 to six companies — Crypto.com, Novig, Kalshi, Polymarket, Robinhood, and Underdog — giving each 30 days to either stop offering sports event contracts to Missouri residents or obtain a license from the Missouri Gaming Commission and pay the state's 10% wagering tax. In a public post, Hanaway wrote that "companies cannot repackage sports bets as 'event contracts' to evade Missouri law." Her letter to Crypto.com also flagged that the platform allows users as young as 18 to trade, while Missouri's minimum age for sports wagering is 21.
The legal arguments
North American Derivatives Exchange argues that the Commodity Exchange Act gives the CFTC exclusive jurisdiction over its contracts, preempting Missouri's gambling law, and that getting a state license isn't a realistic option in the first place — Missouri's constitution allows only two direct mobile sports wagering licenses, and both have already been awarded. It is seeking a declaratory judgment and a permanent injunction barring the state from enforcing its sports wagering law against its contracts. Novig's suit instead asks for a preliminary injunction to preserve the status quo while the Eighth Circuit — which covers Missouri — hears a related appeal out of a Kalshi case originating in Iowa. That underlying legal question has split the federal appeals courts so far, with the Sixth and Ninth Circuits ruling against Kalshi and the Third Circuit ruling in its favor.
Why the other four companies haven't sued
Kalshi, Polymarket, Robinhood, and Underdog all received the same September cease-and-desist letters but, as of the two companies' filings, none had gone to court in either Missouri federal district. Kalshi was reportedly the first of the six to respond to the state, and the attorney general's office has described "ongoing discussions" with it. Underdog, notably, already sued Connecticut last month over a similar crackdown there, but has not taken Missouri to court over this round of letters.
Why it matters to bettors
Missouri only legalized traditional sports wagering by ballot measure in November 2024, and the fight over whether federally regulated "event contracts" on sports outcomes count as a separate, unregulated product is playing out in parallel in several other states, with federal circuit courts currently divided on the underlying question. For a Missouri bettor or trader, the near-term outcome of these two suits — and whether a court grants either company's requested injunction — will determine whether sports event contracts stay available there while the broader legal fight continues, or whether access gets cut off pending the Eighth Circuit's ruling.