Polymarket Blocked from Nevada for at Least Two Weeks
Polymarket is the latest prediction market platform to suffer a legal setback in a state court.
On Thursday, the First Judicial District Court of Nevada filed a temporary restraining order against Polymarket. Polymarket’s U.S. app only offers markets on sports, while its crypto platform offers markets on a diverse range of subjects.
BREAKING: Nevada state court issues temporary restraining order against Polymarket over offering of event contracts, says that the CEA does not vest exclusive jurisdiction in the CFTC. TRO will remain in effect for 14 days; hearing on the PI motion scheduled for 2/11. pic.twitter.com/p1tRk38EMD
— Daniel Wallach (@WALLACHLEGAL) January 30, 2026
The restraining order will remain in place until the judge makes a decision regarding a preliminary injunction during the Feb. 11 hearing. A preliminary injunction would lay out the terms of how Polymarket and Nevada will co-exist as the lawsuit plays out.
Polymarket has since geofenced Nevada from its U.S. app. That hasn’t stopped Polymarket from reaching deals with its agreement with Major League Soccer. However, Polymarket occupies an odd position within the prediction market industry.
Sustainability of dual regulation
Polymarket is unique among CFTC-regulated prediction markets. Platforms like Kalshi have been expanding into crypto by accepting crypto deposits and partnering with crypto exchanges. However, no other platform has built an offshore crypto platform and simultaneously operated a CFTC-regulated exchange.
CFTC Chair Michael Selig has been open about his innovative push to make it easier to hold and trade crypto products. He has also recently come out in favor of sports contracts on CFTC exchanges.
Polymarket sits at the intersection of those two thorny challenges. Selig will have to decide how to regulate a crypto platform he appears to support that offers a U.S. app operating with different boundaries.
Experiments in Polymarket and Kalshi ecosystems
Both Kalshi and Polymarket are investing millions of dollars in builder ecosystems. These ecosystems provide software for builders who want to create their own products using the company’s prediction markets.
For example, Kalshi Builder Gigi Alcaraz is working on a platform focused on directing liquidity to culture markets. Chance.cc is an analytics tool and trading terminal for Polymarket’s markets. These kinds of programs also give builders room to experiment with features like lending and leveraging, two popular types of projects within crypto’s prediction market industry.
Prediction markets may have more legal setbacks ahead of them. But in the meantime, the industry is waiting to see how the CFTC approaches the crypto part of the prediction market industry. The Third Circuit opinion that will signal the likelihood of a Supreme Court case regarding CFTC jurisdiction is also expected to drop any day, since oral arguments were held in September 2025.