Crypto Seeks Opportunity in Sports Betting's Three-Way Legal Battle

The sports betting industry is caught in a three-way legal battle between state-licensed operators, offshore bookmakers, and prediction-market alliances. Amidst this jurisdictional fight, crypto businesses are quietly maneuvering to find opportunities on every side.

Robinhood recently announced a football expansion with Crypto.com, routing selected event contracts through its exchange infrastructure. However, just two days later, Connecticut issued cease-and-desist orders against nine prediction-market companies, including both Robinhood and Crypto.com, for allegedly unlicensed gambling.

The Old Divide Has a New Challenger. OddsTrader's comparison of offshore vs. regulated sportsbooks explains the original distinction: U.S. state oversight versus operators outside that licensing system, with different payment options and avenues for complaints. A foreign license does not substitute for state authorization.

Now, alliances between commercial entities have emerged. PrizePicks launched Kalshi event contracts in November 2025, while the Coalition for Prediction Markets brought together Kalshi, Underdog, Robinhood, Coinbase, and Crypto.com. These are distinct products with different legal arguments, but they can cooperate without making those differences disappear.