Nevada Judge Halts Polymarket's Event Contracts in State, Citing Regulatory Gaps
A Nevada district court has temporarily barred prediction market platform Polymarket from offering its event contracts to residents, delivering a preliminary win to state regulators in a closely watched jurisdictional clash.
The order, issued by Judge James Woodbury, targets Blockratize—the entity behind Polymarket—along with related defendants QCX LLC (doing business as Polymarket US) and Adventure One QSS, Inc. Judge Woodbury granted a renewed ex parte request for a 14-day temporary restraining order, with a hearing on a preliminary injunction motion scheduled for February 11.
The decision arrives as Washington policymakers signal a move toward clearer rules for prediction markets. Just last week, Commodity Futures Trading Commission (CFTC) Chairman Michael Selig noted the agency is preparing a new regulatory framework for such platforms, which have seen billions in trading volume as users bet on outcomes ranging from elections to entertainment awards.
Polymarket has maintained that its contracts fall under federal oversight, arguing it operates a CFTC-designated contract market subject to the agency’s “exclusive jurisdiction.” Nevada’s Gaming Control Board, however, contends that state licensing laws still apply when contracts are offered within its borders.
In his ruling, Judge Woodbury indicated skepticism toward the federal preemption argument—at least for now. “The question of federal preemption is nuanced and rapidly evolving,” he wrote. “At this juncture, the balance of convincing legal authority weighs against federal preemption in this context.”
The court also emphasized the state’s interest in maintaining a tightly controlled gaming environment. The ruling cited “immediate and irreparable” harm from an unlicensed operator evading Nevada’s “comprehensive regulatory structure,” including practical enforcement gaps: limited ability to prevent wagers from individuals who could influence event outcomes, and insufficient tools to block underage participation.
This case represents an early skirmish in a broader conflict between state gaming authorities and platforms that frame event contracts as financial instruments rather than gambling products.
Reader Reactions:
Marcus Chen, Financial Compliance Officer (Las Vegas): “This is a necessary check. If platforms operate outside state licensing frameworks, it undermines decades of work to ensure integrity and consumer protection in regulated markets.”
Rebecca Vance, Tech Policy Analyst (Reno): “The ruling highlights a growing tension between innovative fintech models and existing state regulatory regimes. Clarity from federal regulators can’t come soon enough.”
David Keller, Retail Trader & Podcast Host (Online): “It’s absurd. Nevada happily runs sportsbooks on every corner, but suddenly a transparent, data-driven prediction market is a threat? This is pure regulatory turf protection, not consumer safety.”
Linda Park, Gaming Law Professor (Carson City): “Courts are often cautious before deferring to federal preemption in gaming matters. Nevada’s regulatory interests here are substantial and well-established.”