Connecticut Bans Kalshi, Robinhood, and Crypto.com Over Unlicensed Betting

Connecticut has issued cease-and-desist orders to three major prediction-market platforms — Robinhood, Kalshi, and Crypto.com — for operating unlicensed sports wagering services in the state.

The Department of Consumer Protection sent the orders on Wednesday, citing violations of state gaming laws and consumer protection regulations.

✍️ LATEST: CONNECTICUT ISSUES CEASE-AND-DESIST ORDERS TO ROBINHOOD, https://t.co/UkJzV1FKCK, AND KALSHI, ALLEGING THEIR EVENT CONTRACTS CONSTITUTE UNLICENSED SPORTS BETTING. pic.twitter.com/iG0oGu5cqH

— Coinwaft (@coinwaft) December 4, 2025

DCP Commissioner Bryan T. Cafferelli stated that only licensed entities may offer sports wagering in Connecticut. None of the three platforms possess the required licenses.

Even with proper licensing, their contracts would violate numerous state laws, including offering wagers to individuals under age 21.

Connecticut Officials Warn of Consumer Risks

DCP Gaming Director Kris Gilman emphasized that these platforms deceptively advertise their services as legal. Connecticut’s laws clearly prohibit such operations.

The platforms operate outside regulatory oversight, creating serious consumer risks. Participants face vulnerabilities in financial and personal data protection.

Prediction market wagers differ from legitimate investments, according to state officials. The platforms lack Connecticut’s technical standards for wagering systems.

No integrity controls exist to prevent insiders from placing wagers or manipulating event outcomes. Regulated operators must prohibit known insiders from betting and monitor suspicious activity.

House rules governing wager settlements receive no regulatory review. Connecticut has no authority to recover lost consumer funds if disputes arise.

The platforms allow bets on events with known outcomes, such as award shows and professional team trades. Insiders with special knowledge can exploit this unfairness.

State law prohibits advertising to individuals on the Voluntary Self-Exclusion List and on college campuses. The three platforms allegedly engage in both practices.

Connecticut requires all three platforms to immediately cease operations targeting state residents. They must allow Connecticut users to withdraw all held funds.

Failure to comply may result in civil penalties under the Connecticut Unfair Trade Practices Act. Criminal penalties for gaming statute violations are also possible.

Kalshi Raises $1 Billion as Polymarket Returns to US

Meanwhile, Kalshi closed a $1 billion Series E funding round at a $11 billion valuation. The announcement followed the platform’s best-ever monthly volume in November.

Kalshi raised $1B at an $11B valuation.

A decade ago, only a few thousand people knew what a prediction market was.

Eighteen months ago, most prediction markets were banned – until we overcame the government to set them free.

Over the past seven years, our community has opened… pic.twitter.com/hGDkYxkSlh

— Tarek Mansour (@mansourtarek_) December 2, 2025

Crypto-focused venture firm Paradigm led the round. Sequoia, Andreessen Horowitz, and ARK Invest participated as investors.

Kalshi CEO Tarek Mansour said the platform replaces debate and subjectivity with markets, accuracy, and truth. The funding will support brokerage integrations and news partnerships.

The latest valuation more than doubles Kalshi’s $5 billion valuation from its $300 million October funding round.

Polymarket announced the rollout of its US app to waitlisted users on Wednesday. The platform began with sports event contracts before expanding to broader markets.

The launch followed a CFTC no-action letter issued three months earlier to a derivatives exchange acquired by Polymarket.

Connecticut permits sports wagering only through three licensed platforms: DraftKings operating for Foxwoods, FanDuel for Mohegan Sun, and Fanatics for Connecticut Lottery.

Participants must be at least 21 years old for sports wagering and gaming. Fantasy contest participants must be at least 18 years old.