Missouri AG Sends Cease-and-Desist Letters to Six Prediction Market Operators
Missouri AG Catherine Hanaway issued cease-and-desist letters on September 18 to Kalshi, Polymarket, Robinhood, Crypto.com, Novig, and Underdog — the broadest single-state enforcement sweep yet. The letters give platforms 30 days to comply or obtain state gambling licences. Missouri alleges sports event contracts are unlicensed sports wagering. One day earlier, Montana agreed to pause its own Kalshi enforcement pending the Ninth Circuit en banc process.
Missouri Attorney General Catherine Hanaway sent cease-and-desist letters on September 18 to six prediction market operators simultaneously: Kalshi, Polymarket, Robinhood Derivatives, Crypto.com, Novig, and Underdog. Each letter alleges that the company's sports event contracts constitute unlicensed sports wagering under Missouri law and gives 30 days to comply or obtain a licence from the Missouri Gaming Commission. Missouri has licensed sports betting via a 2022 ballot initiative, with DraftKings, FanDuel, BetMGM, and Caesars as the major licence holders. The Missouri Gaming Commission would be the licensing authority for any prediction market platform seeking to operate legally in the state. No platform has applied for such a licence anywhere in the US.
For UK readers, the Missouri action is closest in structure to a Gambling Commission formal warning that precedes a licence review or regulatory action. The C&D letter does not itself block operation — it gives a compliance window and signals that enforcement action will follow if compliance is not received. Missouri's decision to issue C&D letters to all six major operators simultaneously rather than targeting them sequentially is the most significant tactical shift in state AG enforcement strategy to date. Previous actions (Massachusetts, Nevada, Connecticut, New York) went after individual platforms. Missouri's sweep treats all CFTC-licensed prediction market platforms as equivalent targets regardless of their individual compliance postures or the states they have already settled with.
The Eighth Circuit — which covers Missouri — has not yet ruled on the prediction market preemption question. If Missouri's C&D letters lead to litigation, the Eighth Circuit could become the third circuit to weigh in, potentially amplifying the circuit split that already exists between the Third (for Kalshi) and the Ninth (for Nevada). Adding an Eighth Circuit ruling would increase the pressure on SCOTUS to take the case and resolve the conflict before every circuit has produced its own incompatible answer.
Missouri's action arrives the day after Montana agreed to pause its own enforcement against Kalshi pending the Ninth Circuit en banc process — a direct contrast in approach that illustrates the absence of state AG coordination on enforcement timing. Montana is in the Ninth Circuit and is pausing based on the en banc process; Missouri is in the Eighth Circuit and is escalating regardless of the Ninth Circuit's pending review. The different strategic approaches reflect different political and commercial contexts: Montana's gambling market is smaller, its tribal gaming interests are different from Missouri's licensed sportsbook operators, and the state's AG calculated that a negotiated pause costs less than contested litigation during the en banc window. Missouri's AG has made the opposite calculation — that escalating now, during NFL season, maximises state leverage before the legal question is resolved at the federal level.
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Recent updates
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