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Crypto.com is now taking legal action against Nevada gaming authorities over what it calls unlawful interference in its federally regulated operations. The dispute centers on sports event contracts and whether state officials have the authority to block such markets.
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North American Derivatives Exchange Inc., the derivatives division of Crypto.com, filed a lawsuit in federal court on Tuesday. The suit accuses the Nevada Gaming Control Board (NGCB) of overstepping its authority by forcing the platform to halt its sports event contracts. The complaint was submitted to the U.S. District Court for Nevada and assigned to Judge James C. Mahan and Magistrate Judge Daniel J. Albregts.
Crypto.com argues that its contracts are federally regulated and fall under the supervision of the Commodity Futures Trading Commission (CFTC), not state gambling agencies. “NGCB has no authority to regulate, let alone prohibit, derivatives trading offered by a federally regulated designated contract market operating pursuant to federal law,” the company stated in the filing.
The NGCB issued a cease-and-desist letter on May 20, warning that Crypto.com could face criminal and civil penalties if it continued to offer sports-related prediction markets within the state. Nevada regulators claim these contracts resemble traditional sports betting, which is heavily regulated and restricted to licensed operators.
From the state’s perspective, offering sports event contracts without a Nevada license amounts to illegal betting. Crypto.com, however, maintains that it operates under a federal framework as a designated contract market and should not be subject to state-level enforcement.
Crypto.com is not the only company pushing back on state-level restrictions. Platforms like Kalshi and Robinhood have also drawn attention for offering federally regulated trading products that blur the lines between financial instruments and betting markets.