Crypto.com sues Washington after ruling against Kalshi

The predictive markets platform OG of Crypto.com has filed a federal lawsuit against the state of Washington. This came days after a judge granted a preliminary injunction against Kalshi. OG argues that this ruling and public statements indicate that regulators are likely to pursue similar actions against its federally regulated exchange.

Lawsuit filed after ruling against Kalshi

The lawsuit was filed on July 22, two days after the verdict against Kalshi. The state court ruled in favor of Washington, stating that Kalshi's event contracts violate the state's gambling laws. Kalshi's federal preemption arguments were also rejected. Additionally, Washington's guidance from December 2025 is cited, declaring predictive markets as "unauthorized" and labeling the platform as illegal gambling, alongside the state's involvement in multi-state reports supporting state regulation.

Emphasis on CFTC's order in Michigan

OG's lawsuit highlights a frequently mentioned argument: the Commodity Exchange Act grants the CFTC exclusive authority over federal predictive markets. It underscores the CFTC's recent intervention in Michigan, where it ordered Kalshi to honor trades following a court order. According to OG, this order demonstrates how state enforcement can conflict with the federal regulatory framework.

Defense of sports event contracts

Moreover, OG pays more attention to explaining why sports event contracts have legitimate commercial purposes. The company argues that these contracts are valid financial tools for managing business risks. Examples of businesses that could benefit include:

• Broadcasters affected by the audience.
• Merchants of products related to sports teams.
• Hotels and travel companies experiencing demand spikes.
• Restaurants and bars near stadiums.
• Companies with sports promotional campaigns.
• Fantasy sports operators and related data providers.

"Many businesses in various industries have significant financial exposures to these events," mentions the lawsuit. OG seeks for the federal court to declare Washington's enforcement efforts illegal and to permanently prohibit actions against it.