Coinbase fends off Nevadas emergency bid to halt prediction markets

A Nevada state court denied regulators‘ request for an emergency temporary restraining order (TRO) to immediately halt Coinbase’s new prediction market offering.

Instead, the court set a hearing for next week so the exchange can respond, according to Coinbase chief legal officer Paul Grewal.

The Nevada Gaming Control Board (NGCB) filed a civil enforcement action in Carson City on Monday, accusing Coinbase of offering unlicensed wagers on sports event contracts and asking for a TRO and preliminary injunction to block the products for Nevada residents.

Coinbase fights case in state and federal court

In a Tuesday filing, Coinbase argued that Nevadas requested order was broader than sports betting and would effectively bar it from offering any Commodity Futures Trading Commission (CFTC) regulated “event contracts” in the state, including those tied to financial or commodity outcomes.

Coinbase preliminary opposition. Source: Paul Grewal

The company also told the court there was no genuine claim of irreparable harm because Kalshi, the CFTC‑registered market whose contracts Coinbase lists, can continue to offer the same products directly to Nevada users while litigation proceeds.

Grewal said that Coinbase has now gone to federal court in Nevada as well, seeking to block the states enforcement effort as a violation of federal law.

“Congress gave CFTC exclusive jurisdiction over these listed contracts,” he said, “and it's Congress that calls the shots.”

In its brief, Coinbase contends that the Commodity Exchange Act grants the CFTC “exclusive jurisdiction” over swaps and event contracts traded on regulated exchanges, and that Nevada‘s attempt to recharacterize those instruments as state regulated gambling is preempted by Congress’s derivatives framework.

The clash comes just days after a Nevada judge granted a 14‑day TRO forcing Polymarket to suspend certain event markets in the state.

Nevada isn‘t the only US state pushing back against prediction markets. In January, Tennessee’s Sports Wagering Council ordered a group of platforms, including Kalshi and Polymarket, to halt sport event contracts for its residents.

In December, Coinbase followed Kalshis lead and sued regulators in Connecticut, Illinois and Michigan, arguing that prediction markets listed on a CFTC-regulated venue fall under federal jurisdiction.