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- New York Attorney General Letitia James today sued Coinbase Financial Markets and Gemini, Titan LLC for unlicensed gambling in the state
- According to attorney general, both prediction market companies offer residents ability to illegally bet on sports, politics, and entertainment in New York
- Attorney General James is asking court to require companies to forfeit illegal profits and distribute restitution to customers
New York Attorney General Letitia James today levied lawsuits against both Coinbase Financial Markets and Gemini, Titan LLC, alleging the prediction market companies engaged in unlicensed gambling in the state.
The lawsuits come just two months after James issued a warning to the New York sports betting industry and consumers to steer clear of prediction markets offering event contracts centered around sports, politics, and entertainment.
The lawsuits allege both Coinbase and Gemini offers users the ability bet on events, including sports, entertainment, and elections, without a license and in violation of New York gaming laws.
Gambling is Gambling
James is seeking a court order for both companies to pay fines, forfeit illegal profits, and pay restitution to customers for using their services.
“Gambling by another name is still gambling, and it is not exempt from regulation under our state laws and Constitution,” Attorney General James said in a released statement. “Gemini and Coinbase’s so-called prediction markets are just illegal gambling operations, exposing young people to addictive platforms that lack the necessary guardrails. My office is taking action to protect New Yorkers and stop these platforms from violating the law.”
According to court documents, the New York Attorney General’s Office is seeking a minimum of $1.2 billion in damages against Gemini and $2.2 billion in damages against Coinbase.
James noted in the lawsuits that both companies do not have a license from the New York State Gaming Commission, allowing them to avoid an obligation to pay taxes like licensed casinos and online sports betting platforms.
The companies, she reports, also allow users between 18 and 20-years-of-age to access their markets, despite New York law requiring a person must be at least 21 to participate in online sports betting.
The lawsuits also allege that Gemini and Coinbase both violate New York law that prohibits betting on games in which New York college teams participate.
Coinbase: Prediction Markets Federally Regulated
Sports Betting Dime reached out to Coinbase for a comment on the lawsuit. A Coinbase representative pointed to a statement Chief Legal Officer Paul Grewal posted on the social media platform X:
“About the NY lawsuit news – prediction markets are federally regulated national exchanges, registered with the CFTC. This issue is proceeding in New York federal court as we speak. Coinbase will continue to fight for the federal oversight of these markets that Congress intended.”
A request for comment to Gemini was not returned to Sports Betting Dime.