Connecticut widens sports prediction market crackdown to ad and funding partners
Connecticut has widened its crackdown on sports prediction markets to target advertising, distribution, funding, and support partners alongside the event-contract platforms themselves. The state ordered nine entities to cease activities related to the markets. The expansion follows a federal judge's ruling last month that sports event contracts are illegal, unlicensed, and not shielded by federal commodities law. Some prediction market companies are moving to halt their Connecticut operations after receiving cease-and-desist orders from state authorities.
The crackdown now reaches the infrastructure layer that keeps prediction markets running, not just the trading venues themselves. Marketing agencies, payment processors, and funders face direct state orders, forcing them to choose between dropping prediction market clients or defending gambling charges. Platforms have fewer places to turn for essential services.
The same preemption collapse that exposed Kalshi and Polymarket in Nevada and Utah now widens the liability net to every hand that touches a contract. Partners with thin legal budgets will cut ties first, accelerating a vendor exodus even where platforms are willing to fight. A partner pipeline freeze would raise operating costs across the sector before any court rules on the underlying contracts.