Connecticut extends enforcement to eight platforms as Coinbase and Crypto.com join halt orders

Governor Ned Lamont signed off on cease-and-desist orders against nine prediction market platforms on Thursday, directing Polymarket, Coinbase, Crypto.com, Robinhood, ProphetX, Novig, Webull, Gemini, and Underdog Predict to stop offering sports event contracts to Connecticut residents immediately. The platforms were also told to let customers withdraw funds without restriction.

The action is the second major enforcement move from Connecticut's Department of Consumer Protection in a matter of weeks. The earlier round targeted Kalshi directly, including a lawsuit and an injunction bid. This round lands on a broader set of names, some of which — Coinbase and Gemini — are primarily known as crypto exchanges rather than prediction market operators. Their presence on the list signals that Connecticut is treating distribution infrastructure as part of the problem, not just the platforms that originate the contracts.

Commissioner Bryan Cafferelli cited Connecticut's unfair trade practices statute alongside state gaming law, which gives the state two enforcement paths rather than one. Civil penalties under the consumer protection route do not require proving criminal intent. That matters because several of the named platforms would argue, and have argued elsewhere, that their products are federally regulated financial instruments. Connecticut's framing sidesteps that argument entirely — even if the contract is technically a commodity, selling it to a Connecticut resident without complying with state consumer protection standards is, in the state's reading, a separate violation.

The legal foundation here was laid in August, when a federal judge in Connecticut ruled that sports event contracts constitute illegal unlicensed gambling under state law and are not shielded by federal commodities regulation. That ruling is the predicate for everything that followed. Without it, these cease-and-desist orders would be opening arguments. With it, they are enforcement backed by a judicial finding.

The state also raised something the platforms have been quieter about: Connecticut says some of these products have been sold to people under twenty-one, the state's legal betting age, and to individuals on the voluntary self-exclusion list. A few platforms allegedly offered contracts on Connecticut collegiate sports, which are barred even for licensed operators.

That detail should concern the industry more than the cease-and-desist orders themselves. Federal preemption arguments are at least coherent legal theory. Serving self-excluded problem gamblers and minors is a consumer harm claim with no constitutional answer.

The reporting consensus treats this as a Connecticut story. The more important fact is structural. Connecticut now has a replicable enforcement template — a federal court ruling in hand, two statutory bases for action, documented consumer harms, and a list that includes major financial infrastructure names rather than fringe operators. Any state attorney general watching this can see exactly how the sequence works.

What the platforms do next — comply, litigate, or exit the state — will determine whether that template gets copied. Capitulation in Connecticut makes the next state's enforcement cheaper. A successful preemption argument in Connecticut would slow it down. Neither outcome is settled, but the states are no longer working from theory alone.