NYC Council Probes 4 Prediction Markets Over Ad Practices
Speaker Julie Menin said the investigation covers Gemini Titan, Kalshi, Polymarket and Coinbase, and follows reports that Polymarket paid creators to misrepresent their trading earnings.
The New York City Council said Wednesday that it is investigating four prediction market companies over allegations of deceptive marketing.
The inquiry will examine the advertising practices of Gemini Titan, Kalshi and Polymarket, all based in New York, as well as Texas-based Coinbase.
"Prediction markets aggressively entice consumers to bet and wager on sports, politics, culture, weather and pretty much anything," Council Speaker Julie Menin said in a statement. "We refuse to let New Yorkers, especially our young people, become collateral damage."
Menin has requested information from the platforms about how they market themselves in New York. A Council spokesperson said the four companies were selected based on public reports and other material reviewed so far, and on how much of their marketing reaches New York City residents. The inquiry could be expanded to include additional platforms, the spokesperson said.
Prediction markets let users wager on sports, political elections and a wide range of other events.
The investigation follows a June report by The Wall Street Journal that found Polymarket paid online content creators to post videos misrepresenting their earnings from trades. The platform said in response that it would audit its promotional content. On Monday, the Council said it would investigate those allegations, including claims that Polymarket targets younger adults with false and deceptive marketing.
"The Council is investigating allegations involving Polymarket and, critically, the extent to which similar marketing practices are prevalent within the prediction market industry more broadly, and related social harms to City residents," Menin wrote in a letter to Polymarket founder and Chief Executive Shayne Coplan that was shared with CBS News.
Menin, who represents the Upper East Side, said the goal is to determine whether more legislation, enforcement and education are needed to combat "abusive marketing" in the city.
"We look forward to engaging with the New York City Council on this matter," Polymarket said in a statement. A Coinbase spokesperson said the company "offers our customers access to federally regulated prediction markets overseen by the CFTC, and fully complies with applicable laws." The other companies did not immediately respond to requests for comment.
The probe lands amid a turf fight over who regulates prediction markets. New York Attorney General Letitia James has sued Coinbase, Gemini Titan and Kalshi, accusing them of running illegal gambling operations. The Commodity Futures Trading Commission has sued to block states from tightening rules, arguing Congress gave it exclusive jurisdiction over derivatives. Attorneys say it remains legally murky whether that authority extends to sports betting, which drives much of the trading volume.
Menin's letter says the Council's investigation does not focus on whether the platforms violate state gambling laws.
This article was produced with the assistance of artificial intelligence (AI), in accordance with our editorial policy.
