Nevada Gaming Regulator Files Lawsuit to Block Coinbase Sports Event Contracts

Highlights:

• Nevada regulators say Coinbase sports event contracts violate state gambling law.
• The case shows rising tension between state rules and federal oversight.
• Nevada has increased enforcement actions against crypto firms in recent months.

The Nevada Gaming Control Board filed a civil enforcement action against Coinbase Financial Markets after regulators accused the company of offering unlicensed wagering products. The filing was submitted on Monday in the Carson City District Court. Regulators said Coinbase offered event-based contracts tied to sports outcomes. Under Nevada law, authorities classify such contracts as wagering activity.

🚨BREAKING: COINBASE FACES LEGAL ACTION IN NEVADA

Nevada gaming regulators have sued @Coinbase over alleged illegal sports wagering products.

The complaint claims Coinbase operated a derivatives exchange linked to sporting bets without approval.

Authorities are seeking a… pic.twitter.com/eq027o52IO

— BSCN (@BSCNews) February 4, 2026

As a result, the board said Coinbase required a state gaming license. However, regulators said the company operated without one. Therefore, the board asked the court to intervene. It requested a temporary restraining order and a preliminary injunction. These measures would immediately halt the activity in Nevada.

In addition, the board sought permanent injunctive relief. Regulators argued that the alleged violations continue each day. They said the ongoing activity has harmed the state’s gaming framework. According to the filing, the delays weaken oversight and enforcement.

Regulators also focused on consumer access. They said Coinbase allows users aged 18 and older to trade the contracts. Nevada law sets the legal gambling age at 21. Officials said the structure weakens consumer protections because of this gap. They argued the platform fails to meet state safeguards.

The board was also concerned with fairness in the market. Sports books are licensed and pay taxes and fees. They are also required to maintain a physical presence and adhere to high compliance standards. Conversely, regulators noted that Coinbase does not bear such responsibilities. They contended that the company has obtained an unfair competitive advantage.

Federal Oversight Debate Deepens Around Coinbase Sports Event Contracts

The Nevada action followed Coinbase’s recent expansion of prediction markets nationwide. The company launched the product through a partnership with Kalshi. Kalshi operates as a CFTC-registered designated contract market. Coinbase cited this federal status as legal justification. However, Nevada officials rejected that argument.

State regulators said federal oversight does not override state gambling laws. Instead, they argued sports-linked event contracts still qualify as wagering in Nevada. As a result, they said state licensing rules apply. The board framed the dispute as jurisdictional. Officials stressed that state authority remains intact. The case reflects a wider regulatory conflict. Prediction markets sit between derivatives trading and gambling regulation.

Coinbase has challenged similar actions in other states. The company filed federal lawsuits against regulators in Connecticut, Michigan, and Illinois. Those states issued cease-and-desist letters tied to prediction markets. Coinbase argued that state actions interfere with federally regulated products. Nevada’s filing directly contests that position.

MAKE THAT 3 LAWSUITS!

Coinbase also sued the Connecticut Attorney General and the Michigan Attorney General over their efforts to rein in prediction markets. 10 states are now in litigation with prediction market platforms. IL and MI are the latest entrants. https://t.co/xLfhx1z6XO pic.twitter.com/2EiE94tJrl

— Daniel Wallach (@WALLACHLEGAL) December 19, 2025

Other firms have raised similar objections. Robinhood Derivatives filed lawsuits in Nevada and New Jersey on Tuesday. The company said regulators threatened civil and criminal penalties. It argued that federal oversight should take precedence. The filings added pressure to the growing jurisdictional dispute.

Prior Court Orders Signal Growing State Pressure

Nevada has acted in the same manner towards other platforms aside from the Coinbase event sport contracts. A state court has recently issued a temporary restraining order against a Polymarket operator. The order prevented the site from selling event-based contracts to the Nevada residents. One of the reasons cited by the judge was immediate and irreparable harm.

BREAKING: Nevada state court issues temporary restraining order against Polymarket over offering of event contracts, says that the CEA does not vest exclusive jurisdiction in the CFTC. TRO will remain in effect for 14 days; hearing on the PI motion scheduled for 2/11. pic.twitter.com/p1tRk38EMD

— Daniel Wallach (@WALLACHLEGAL) January 30, 2026

Kalshi has also had previous conflicts with Nevada. The dispute started last year with a cease-and-desist order. Even though a short injunction ensued, it was later lifted by the courts. Meanwhile, the case is under appeal.

The state authorities have also intervened beyond gaming disputes. The Financial Institutions Division of Nevada gave a cease-and-desist order to crypto company Fortress Trust. A Bloomberg report revealed that the order cited the extreme liquidity issues of the company. According to regulators, the firm was unable to meet customer withdrawal demands. The move compelled the company to shut down.