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Coinbase agreed to stop offering new sports-related prediction market contracts to Michigan customers. The operator is the latest operator to do so in the midst of ongoing legal battles over whether the contracts constitute gambling.
Under an agreement announced Oct. 7, the Michigan Gaming Control Board mandated that Coinbase close existing positions by Oct. 10. The agreement covers contracts traded on Kalshi and other exchanges regulated by the Commodity Futures Trading Commission (CFTC). Per the agreement, Michigan regulators won’t pursue enforcement action against Coinbase while the company complies with the restrictions and related appeals continue.
“Coinbase joining Robinhood and Kalshi in stepping back from these unlicensed sports contracts underscores Michigan’s commitment to enforcing its gaming laws,” Michigan Gaming Control Board Executive Director Henry Williams said.
Coinbase appeal still pending
The agreement does not settle Coinbase’s lawsuit challenging Michigan’s assertions that it has jurisdiction over sports prediction markets offered in the state. Coinbase sued state regulators in December 2025 arguing that its contracts fall under the exclusive jurisdiction of the CFTC, rather than state gambling laws. In an August ruling, U.S. District Judge Shalina Kumar rejected Coinbase’s request for a preliminary injunction blocking Michigan regulators from enforcing those laws.
The judge ruled that Coinbase had not demonstrated that sports event contracts qualify as federally regulated swaps or that federal law overrides Michigan’s gambling regulations. Coinbase appealed to the Sixth Circuit which has paused proceedings pending decisions in two related Kalshi appeals involving Ohio and Tennessee. Separate appeals involving Robinhood and Polymarket are also before the court.
Robinhood reached a similar agreement with state regulators in September. Michigan previously obtained a state court preliminary injunction against Kalshi. Michigan maintains that companies offering sports wagering must follow its gambling laws, regardless of how those products are classified by operators.
The restrictions against Coinbase come amid legal disputes nationwide between prediction market operators and state regulators over whether sports event contracts are federally regulated financial products or sports wagers subject to state licensing regulations.
