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Baltimore Mayor Brandon Scott and the City Council filed separate suits Thursday in Baltimore City Circuit Court against Kalshi and Polymarket, alleging their sports-event contracts amount to illegal gambling under the city’s Consumer Protection Ordinance. The complaints say the platforms offer game winners, point spreads and player-performance contracts without the licenses, oversight, taxes and consumer protections required of sportsbooks. Kalshi’s case also names Coinbase, Robinhood and Webull as distribution partners and includes eight counts of deceptive and unfair trade.
Why it matters
Baltimore’s theory challenges the line between a prediction market and a sportsbook. The city says Kalshi and Polymarket offer the same wagers as licensed sportsbooks, then use prediction-market labels and federal regulatory status to avoid state rules. Scott said the companies are “running sportsbooks without licenses” and “betting that a new label will put them above the law.”
Kalshi says it spent years getting regulated by the federal government, follows applicable regulations including consumer-protection laws and will defend the claims. The Polymarket complaint names QCX LLC, Blockratize Inc. and QC Tech LLC and alleges its internal market-making team can take positions against users, so customers may sometimes trade against the house.
Market impact
The legal and commercial stakes reach beyond the two operators. Baltimore seeks maximum statutory penalties, restitution for affected customers, disgorgement of allegedly unlawful proceeds and an order blocking unauthorized sports betting for city residents.
A ruling would put state licensing risk around sports contracts and their distribution through Coinbase, Robinhood and Webull apps under scrutiny. The next signals are the companies’ defenses and the court’s response to Baltimore’s requested block.
Frequently asked questions
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Why does Baltimore say Kalshi and Polymarket are operating sportsbooks?
Baltimore says the platforms offer game-winner, point-spread and player-performance contracts similar to sportsbook wagers without the licenses and consumer protections required of sportsbooks.
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Why are Coinbase, Robinhood and Webull named in the Kalshi case?
Baltimore alleges the companies distribute Kalshi event contracts through their apps, allowing users to trade them inside the platforms’ prediction-market segments.
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What does Baltimore’s eight-count complaint seek from the court?
The city seeks maximum statutory penalties, restitution for affected customers, disgorgement of allegedly unlawful proceeds and an order blocking unauthorized sports betting for Baltimore residents.
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Why is Polymarket’s market-making team central to Baltimore’s case?
The complaint alleges the team can take positions against users, meaning customers may sometimes trade against the house rather than one another. Baltimore says that blurs the line between a prediction market and a sportsbook.
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How has Kalshi responded to Baltimore’s lawsuit?
Kalshi says it spent years getting regulated by the federal government, follows applicable regulations including consumer-protection laws and will defend the claims.
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