Crypto.com’s OG sues Washington state after Kalshi injunction

Crypto.com’s OG prediction market platform has joined the legal fight in Washington state, filing suit after a King County Superior Court judge issued a preliminary injunction against Kalshi. For high-risk operators and their PSPs, the point is simple: if one state court treats event contracts as illegal betting, the enforcement risk does not stay neatly inside one company’s file.

1. On July 22, North American Derivatives Exchange, the Crypto.com subsidiary that operates OG, filed a federal lawsuit against Washington’s attorney general and members of the state’s Gambling Commission in the US District Court for the Western District of Washington.
2. The complaint asks for declaratory and injunctive relief and argues that Washington lacks authority to regulate OG’s event contracts. It says state gambling laws are preempted by federal law and that the Commodity Exchange Act gives the CFTC exclusive jurisdiction over derivatives trading.
3. OG says Washington’s designation of event contracts as illegal gambling activities ignores that federal framework. In the filing’s words: “OG cannot comply with both its federal law obligations and any purported obligations under Washington law”.
4. The lawsuit was triggered by this week’s preliminary injunction against Kalshi in King County Superior Court, which stopped Kalshi from offering sports bets in the state. OG says that ruling creates an imminent threat of enforcement that would cause irreparable harm.
5. The complaint also points to the CFTC’s 14 July emergency order requiring Kalshi to honour trades for Michigan customers after a state court had ordered it to unwind positions. OG is the second CFTC-registered prediction market operator to sue Washington over enforcement risk, following an earlier action by Robinhood.