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Ohio’s gaming commission became the latest state regulator to take action against sports event contracts, sending cease-and-desist letters to the three exchanges offering them.
The Ohio Casino Control Commission announced on Monday (March 31) that it had sent letters to Kalshi, Robinhood and Crypto.com ordering them to stop offering sports event contracts in Ohio and calling them sports wagering products not permitted under state law.
“Purchasing a contract based on which team a person thinks will win a sporting event is no different than placing a bet through a traditional sportsbook,” Ohio Casino Control Commission (OCCC) executive director Matthew Schuler said in a statement.
“The only difference is that these event contracts do not have the consumer protections required under Ohio law and are accessible to Ohioans under 21 years of age. The commission must take action to fulfill its statutory responsibilities and ensure the integrity of sports gaming in Ohio.”
In the similarly worded letters obtained by Vixio GamblingCompliance, Schuler wrote that the companies are violating state laws by offering sports gaming without a license and facilitating bookmaking, while committing a “flagrant disregard” of Ohio’s statutory gambling age of 21 by accepting players 18 and older.
One area where the letters are different is in the area of responsible gaming.
Schuler criticized Crypto.com and Robinhood for failing to offer the responsible gaming and consumer protections offered by licensed sportsbooks, including no prevention for individuals who had self-excluded.
However, Schuler also noted Kalshi’s recent partnership with IC360 to create a consumer protection hub that included deposit limits, cool-off periods and voluntary opt-outs, and cited it as further evidence that Kalshi is operating a sports-betting platform.
“While Kalshi may assert that the offerings are not sports gaming or gambling, Kalshi is trying to act like a regulated, licensed sportsbook,” he wrote. “Kalshi is demonstrating that it considers its products akin to sports wagering by using similar features offered by the licensed and regulated sports gaming industry.”
In each letter, the commission demanded that the three companies stop offering sports-event contracts in Ohio by April 14.
Ohio joins Nevada and New Jersey as states that have pushed back against the expansion of the prediction markets with cease-and-desist orders against at least one of the companies.
Robinhood responded to a cease-and-desist from the New Jersey Division of Gaming Enforcement by withdrawing from the state, although it maintained it believed its offering was legal.
The company did not respond to a request for comment Monday evening about whether it would do the same in Ohio.
Meanwhile, Kalshi responded differently, filing lawsuits in federal court in recent days against regulators in both Nevada and New Jersey, seeking to prevent the states from taking action against them, and it hinted at a similarly strong stand against the latest action in Ohio.
"The threatened actions from the (OCCC) seek to undermine not just Kalshi’s contracts, but the authority granted by Congress to the Commodity Futures Trading Commission, which has safely and effectively governed commodities markets for decades,” said Kalshi CEO Tarek Mansour in a statement.
“Prediction markets are a critical innovation of the 21st century, and like all innovations, they are initially misunderstood,” Mansour continued. “We are proud to be the company that has pioneered this technology and stand ready to defend it once again in a court of law.”
