Maryland joins states cracking down on prediction markets
Maryland Takes a Stand Against Unregulated Sports Prediction Markets
In a significant regulatory move, Maryland has become the fifth state to issue cease-and-desist letters to Kalshi, Robinhood, and Crypto.com, underscoring a growing concern about unregulated sports prediction markets. The Maryland Lottery and Gaming Control Commission has mandated that these companies cease offering contracts tied to sporting events within state lines.
This decisive action sees Maryland teaming up with Illinois, Ohio, Nevada, and New Jersey, states that have similarly sought to curtail what they perceive as a form of unlicensed sports betting masquerading as prediction markets.
“This is a fundamental legal issue, a consumer protection concern, and carries considerable fiscal implications for the state,” stated John Martin, Director of the Maryland Lottery and Gaming Control Commission, in an official press release. “Every legal sports wagering operator in Maryland has undergone an exhaustive licensing process and adheres to stringent regulations that encompass responsible gaming requirements. In contrast, these commodity traders operate without such safeguards, effectively conducting sports wagering without a license and bypassing the sports wagering taxes that our licensed operators contribute to the state treasury.”
Officials have pointed out that the activities of Robinhood, Kalshi, and Crypto.com breach Maryland’s gaming laws, which explicitly define sports wagering to include any contracts based on the outcome of sporting events. Importantly, state regulations mandate that platforms accepting wagers on sports must verify that all participants are at least 21 years of age and physically present within state boundaries—requirements that these commodity traders do not fulfill.
A Rising Wave of Regulatory Action
Prior to Maryland’s move, Illinois had recently issued similar cease-and-desist notifications to Kalshi, Robinhood, and Crypto.com. The Ohio Casino Control Commission also took action last Monday, aligning its stance with the increasing push against unregulated sports betting platforms. In a striking response to the escalating regulatory scrutiny, Kalshi filed lawsuits against gaming regulatory authorities in both Nevada and New Jersey after receiving their own cease-and-desist letters from these respective gaming agencies.
This surge in regulatory actions highlights the critical need for clarity and compliance within the sports betting landscape, ensuring that consumer protections are maintained and that legal operators operate on an even playing field.
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