Lynnae Williams Journalist
Lynnae is a journalist covering the intersection of technology, culture, and gambling. She has more than five years of experience as a writer and editor, with bylines at SlashGear and MakeUseOf. On the iGaming side,...
Read Full BioThe Nevada Gaming Control Board (NGCB) has filed a civil enforcement action against Coinbase Financial Markets, Inc., alleging the platform is carrying out unlicensed gambling activities in the state.
The NGCB filed the complaint in the District Court for Carson City on February 2, 2026, seeking a permanent injunction and a declaratory judgment to stop Coinbase from offering event contracts to the state’s residents.
In a statement announcing the lawsuit, the NGCB explained its stance: “Coinbase offers products referred to as event contracts for sale on its mobile app…the Board considers offering sports event contracts, or certain other event contracts, to constitute wagering activity.” The Board goes on to say that “entities offering such event contracts must be licensed.”
The NGCB’s legal challenge arrives just days after Coinbase announced a nationwide rollout of its prediction markets. In the Coinbase app, users can trade on the outcomes of real-world events across categories such as sports, politics, and culture.
Nevada regulators say these event contracts, especially those involving sports betting, amount to wagering under state law and require specific gaming licenses that Coinbase doesn’t hold.
Regulators: Coinbase Event Contracts Require Gaming Licenses
In the complaint, the NGCB outlines the multiple provisions of the Nevada Revised Statutes (NRS) that it says Coinbase’s operations violate. The Board classifies sports event contracts as either a “sports pool” or a “percentage game,” both of which fall under Nevada’s strict gaming regulatory framework.
The lawsuit highlights several of Coinbase’s alleged violations of Nevada law:
- Unlicensed wagering: Offering sports-related event contracts without a state-issued gaming license.
- Age restrictions: Nevada law prohibits gambling by individuals under 21, while Coinbase’s user agreement allows participation beginning at age 18.
- Public policy protections: Nevada law requires gaming to be “licensed, controlled, and assisted to protect the public health, safety, morals, good order, and general welfare.”
“The Board takes seriously its obligation to operate a thriving gaming industry and to protect Nevada citizens,” said Mike Dreitzer, Chairman of the Nevada Gaming Control Board. “The action taken yesterday reinforces this obligation.”
Coinbase’s ‘Everything Exchange’ Meets Regulatory Resistance
While the lawsuit focuses on Coinbase’s specific violations of Nevada gaming law, the legal challenge comes as Coinbase is promoting its “Everything Exchange” model. Coinbase’s initiative aims to integrate traditional equities and derivatives alongside prediction markets into a single interface.
The company officially launched its prediction market product in partnership with Kalshi, a CFTC-regulated exchange, on December 17, 2025. On January 28, Coinbase announced the prediction markets had gone “fully live” in all 50 states, a move the complaint argues brought unlicensed wagering directly to Nevada residents.
Coinbase CEO Brian Armstrong has taken to X to sell prediction markets as a mechanism for “truth seeking,” writing: “Prediction markets are the ultimate form of truth seeking. When there’s skin in the game, the output is far more reliable. Everything else is biased by someone’s agenda.”
In a separate post, Coinbase contrasted its model with traditional sportsbooks, stating: “Out: Odds set by the house. In: Price set by the crowd.” The complaint brought by the NGCB makes clear that Nevada’s regulators aren’t buying what Coinbase is trying to sell, arguing that the company’s practice of collecting transaction fees makes it the “house” in a percentage-based wagering system.
Coinbase Joins List of Prediction Markets Challenged in Nevada
Coinbase is the latest in a long list of prediction markets Nevada regulators have targeted over the past year. The state is known for aggressively defending its gaming regulatory authority and has taken a hard line against event-contract platforms operating without state gaming licenses.
On January 16, the NGCB announced it had taken similar action against Polymarket for offering “unlicensed wagering in violation of Nevada law.” The lawsuit was filed not long after the company returned to the United States.
The NGCB complaint against Coinbase notes that it doesn’t have a physical presence in Nevada and doesn’t pay taxes on the gross gaming revenues it receives from users in Nevada, both of which are requirements for licensed operators.
The lawsuit also touches on the risks of inside information being used on the platform due to a lack of safeguards: “On information and belief, Coinbase does not employ adequate safeguards to ensure that wagers are not being placed on an event from owners, coaches, players, or officials participating in the event, and does not communicate about potential evidence of match fixing or point shaving with Nevada gaming regulatory authorities.”
This has become a point of contention with prediction markets, as scandals involving the use of inside information have engulfed sports leagues, including the NBA and MLB, in recent months. Further, communication between leagues, integrity monitors, and regulators is viewed as critical to stopping the type of misconduct alleged in the NCAA point-shaving scandal, which came to light in early January.
As of February 3, 2026, the Board has also filed an ex parte application for a temporary restraining order that would immediately bar Coinbase from offering event contracts to Nevada residents while the civil action moves forward.
