Connecticut Cracks Down on Unlicensed Sports Betting by Major Platforms

Connecticut ordered Robinhood, Crypto.com, and Kalshi to halt unlicensed sports betting, citing violations of state law, age restrictions, and lack of consumer safeguards. The platforms must stop operations and allow users to withdraw funds.

Connecticut's Department of Consumer Protection has issued cease-and-desist orders to Robinhood, Crypto.com, and Kalshi, accusing them of offering unlicensed online sports betting through event contracts. The state alleges these platforms operated without the required licenses, violated age restrictions by allowing wagers from individuals under 21, and failed to implement safeguards against insider manipulation and underage betting. Regulators also criticized the lack of integrity controls and consumer protections, such as systems to prevent self-excluded individuals and college students from accessing gambling services. The companies were ordered to immediately stop advertising, offering, or promoting these products to Connecticut residents and to allow users to withdraw their funds. Officials warned that noncompliance could result in civil or criminal penalties. The enforcement action highlights ongoing regulatory challenges in the prediction market sector, where platforms enable trading on real-world events. Kalshi and Robinhood have argued their products are federally regulated, but Connecticut maintains that state law requires specific licensing and consumer protections.