Crypto.com has sounded a retreat from several markets, one of which is notably Arizona.
After the Arizona Department of Gaming issued a cease-and-desist letter to the company and further went after Underdog, cautioning it against offering prediction markets with Crypto.com, there has been a realignment of the latter’s efforts to maintain a presence in sports event contracts.
Crypto.com Retreats from Several Markets as It Doesn’t Want to Engage in Local Fights with Regulators
Crypto.com has confirmed that it has pulled the plug on this offer in Arizona on December 12, as well as cancelled sports event contracts in Michigan, Maryland, Massachusetts, Illinois, New Jersey, Nevada, and Ohio, and is not offering services of any kind in New York.
Crypto.com, in other words, has chosen a conciliatory path with states and regulators, refusing to fight battles that the company sees as detrimental to its overall business efforts.
Sport event contracts will remain available in other states, however, and the company is currently exploring various other options, including partnerships with Underdog.
In the meantime, Fanatics Betting and Gaming, another gambling company, which has also launched a dedicated prediction market offshoot – Fanatics Markets – could yet come under fire from the Arizona Department of Gaming.
Fanatics is also a partner with Crypto.com, and it remains to be seen how local regulators respond, although, at first glance, there seems to be very little material difference between Underdog and Fanatics’ situations.
Crypto.com has generally had a little less luck fighting off legal challenges than rival Kalshi, which seems determined to keep pushing the legal boulder uphill for a chance to redefine how prediction markets, and especially those involving sports, are interpreted by gaming regulators.
Kalshi has mostly been able to secure stays in unfavorable rulings, arguing its case further up the legal food chain. Crypto.com has mostly preferred to comply and bide its time.
With the prediction market set to hit $10 billion by some estimates, and mainstream sports betting companies clearly circling and entering the market, there is little to suggest that companies will give up interests and claims in the vertical.