A Nevada state court has issued a temporary restraining order blocking Blockratize, the entity behind Polymarket, from offering event-based contracts in the state for two weeks, finding that the platform’s activities likely violate Nevada gaming law and are not shielded by exclusive federal derivatives oversight.
The order blocks Polymarket from offering sports and events contracts to Nevada residents ahead of a February 11 hearing on a preliminary injunction.
If upheld, platforms like Polymarket and competitor Kalshi may be forced to obtain state-by-state gambling licenses or abandon sports-related markets entirely, a business segment representing over 80% of some platforms' trading volumes.
"The resulting harm in evasion of Nevada's 'comprehensive regulatory structure' and 'strict licensing standards' is immediate, irreparable, and not sufficiently remediable by compensatory damages," the judge wrote.
The order declared that "an unlicensed participant beyond the Board's control, such as Polymarket, obstructs the Board's ability to fulfill its statutory functions," including preventing wagers from individuals who could influence sporting event outcomes, blocking underage participants, and keeping unsuitable individuals from involvement.
"The balance of hardships and public interest in maintaining meaningful control over Nevada's gaming industry for the purpose of ensuring its integrity strongly supports issuance of the temporary restraining order," Judge Woodbury added.
State-level enforcement may increase “compliance costs and legal uncertainties, potentially deterring investment and slowing the development of new features or products in the prediction market sector,” Even Alex Chandra, a partner at IGNOS Law Alliance, told Decrypt.Chandra said the government needs to provide “clearer guidelines, potentially standardizing the industry and fostering long-term growth.”
The Nevada action follows similar enforcement moves across multiple jurisdictions.
The bill would stop federal elected officials, political appointees, and employees of Congress and executive agencies from participating in prediction markets when they possess "material non-public information" about a market or the ability to influence its outcome.
Decrypt has reached out to Polyarket for comment.
