New York Attorney General Letitia James and Governor Kathy Hochul sued prediction market provider Polymarket’s U.S. business Thursday, alleging the platform is running an illegal gambling operation in the state.

The lawsuit, filed against QCX LLC, which does business as Polymarket US, asks a court to stop the company from operating in New York without a gambling license. The state also wants Polymarket to give up what it said are illegally earned gains, pay restitution to customers and face fines equal to three times those gains.

Polymarket launched its U.S. platform in December 2025 with markets that let users put money on the outcomes of sporting events. The company said at the time that it planned to expand into other types of markets.

New York argued those contracts amount to gambling under state law because users are putting money on events with uncertain outcomes. The state also said Polymarket lets people ages 18 to 20 use the platform, while New York requires users to be at least 21 to participate in mobile sports betting.

The case adds to a growing fight between prediction markets and state gambling regulators over who has the authority to oversee the products.

Prediction market companies argue that their event contracts are financial products overseen at the federal level by the Commodity Futures Trading Commission (CFTC). States have taken a different view, particularly when the contracts involve sports, arguing that the products are effectively bets and must follow state gambling rules.

New York has been one of the most active states in that fight.

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