Baltimore City has initiated legal action against leading prediction market operators, arguing that their sports-related offerings amount to unauthorized gambling that harms local consumers. On August 13, 2026, Mayor Brandon Scott and the City Council filed separate complaints in Baltimore City Circuit Court targeting Kalshi and Polymarket.
The Kalshi suit also lists several major financial platforms that distribute its contracts—Coinbase Financial Markets, Robinhood Markets and its derivatives unit, and Webull Corporation along with Webull Financial—as co-defendants.
City officials contend that these companies violated Baltimore’s Consumer Protection Ordinance by providing sports wagering without the licenses required under Maryland law.
The platforms allow residents to place real-money positions on game outcomes, point spreads, totals, player statistics, and similar propositions commonly available through licensed sportsbooks.
Although the operators frame these as “event contracts” or prediction market trades, the city maintains they function as traditional sports bets.
Officials say this labeling lets the firms sidestep state licensing, taxation, responsible-gaming rules, age restrictions (Maryland requires participants to be 21, while some platforms permit 18-year-olds), and other consumer safeguards imposed on regulated operators.
In the Kalshi complaint, Baltimore specifically alleges that crypto exchange Coinbase, Robinhood, and Webull enable users to access and trade Kalshi sports-event contracts directly inside their own apps and prediction-market hubs, without needing to leave those platforms.
The filings further claim that certain “combo” features offered through Kalshi and Robinhood operate much like parlays.
Against Polymarket (identified through related entities including QCX LLC, Blockratize Inc., and QC Tech LLC), the city asserts that an internal market-making operation allows the platform at times to take positions opposite customers, effectively functioning more like a house-backed sportsbook than a pure peer-to-peer prediction market.
Mayor Scott stated that the companies “are running sportsbooks without licenses and betting that a new label will put them above the law,” adding that Baltimore will not permit large firms to prioritize profits over community protection through what the city views as illegal gambling.
City Solicitor Ebony Thompson emphasized that the operators cannot evade local consumer protections simply by recharacterizing gambling activity or invoking federal oversight.
The complaints seek maximum statutory civil penalties (up to $1,000 per violation), an injunction preventing the platforms from offering unauthorized sports wagering to Baltimore residents or accepting their transactions, restitution for affected consumers, and disgorgement of alleged ill-gotten gains.
Kalshi responded by describing the suits as political theater and an attempt to relitigate issues already on appeal before the Fourth Circuit.
The company asserts it operates lawfully under exclusive federal Commodity Futures Trading Commission (CFTC) jurisdiction and complies with consumer-protection requirements.
Polymarket has similarly argued that prediction markets on CFTC-registered exchanges fall under federal law rather than a patchwork of state and local rules.
The actions highlight ongoing tension between local efforts to regulate sports-related activity and the federal framework governing event contracts on registered exchanges. Baltimore seeks to halt what it calls unlicensed operations that drain resources from the city without providing the tax revenue, jobs, or protections associated with licensed gambling.