Missouri Joins State Battles Against Prediction Markets
Missouri is the latest battleground in the growing clash between state gambling regulators and prediction market operators operating under federal regulation.
Attorney General Catherine Hanaway issued formal cease-and-desist notices on Sept. 16 and Sept. 17 to six of the biggest prediction market apps: Kalshi, Polymarket, Robinhood, Underdog, Novig, and Crypto.com. The notices argue that sports event contracts traded on the platforms fall squarely within Missouri’s legal definition of sports betting.
“Missourians voted for a safe, well-regulated sports wagering market that supports public education and addresses problem gambling. Companies cannot repackage sports bets as ‘event contracts’ to avoid Missouri law,” Hanaway said.
Under Missouri law, companies offering sports wagering must be licensed by the Missouri Gaming Commission, pay applicable taxes and fees, and ensure that bettors are at least 21 years old.
State officials argue that prediction market apps are effectively allowing Missouri residents to wager on game outcomes — including Kansas City Chiefs games — without complying with those requirements or contributing tax revenue to the state.
Age restrictions are one of the clearest points of contention. Missouri sports betting is limited to adults 21 and older, while several prediction platforms allow users as young as 18 to open accounts and trade event contracts.
The six operators have 30 days from the date of the notices to stop accepting sports event contracts from Missouri residents. Failure to comply could lead to formal litigation from the Attorney General’s Office.
More prediction market legal updates
After the Third Circuit ruled that federal law preempted New Jersey sports betting regulations, the state took the dispute to the U.S. Supreme Court. The move came after the Ninth Circuit reached the opposite conclusion in a separate Kalshi case, creating a direct circuit split over whether states can regulate sports event contracts offered on federally regulated prediction markets.
In Michigan, Kalshi has been barred from offering sports-related event contracts to residents after state regulators won a series of court orders against the company. Ingham County Circuit Court Judge Rosemarie Aquilina initially issued a temporary restraining order on June 29, requiring Kalshi to block Michigan users from accessing the contracts. The restrictions were subsequently extended, and in September the court granted Michigan a preliminary injunction, keeping the ban in place while the underlying litigation continues.
Kentucky has pushed back against Kalshi's attempt to move the case into federal court. Kentucky filed the lawsuit in Franklin Circuit Court in June, accusing Kalshi and other prediction-market operators of offering unlicensed sports betting. Kalshi subsequently sought to remove the case to federal court, but Attorney General Russell Coleman has argued that the company's federal-preemption defense does not provide a basis for removal. That jurisdictional fight remains ongoing.
