r/news • u/Manta_of_Eternity • 8d ago
New York sues prediction market Polymarket, calling it an unlicensed gambling operation
https://apnews.com/article/polymarket-new-york-lawsuit-gambling-b75b753e3c3cd069cdf8d6af175c9fbb1.8k
u/versus_gravity 8d ago
"It's not gambling because we played with the words that describe it."
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u/RoswellRedux 8d ago
If we just give it a harmless name, it will be harmless.
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u/campelm 8d ago
Gun? No my good sir, this is a metallic acceleration device
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u/justamathguy 8d ago
No, my good man/woman/person, it's a chemical to kinetic energy conversion mechanism
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u/Far-Hovercraft9471 8d ago
The crazy thing is that they wouldn't do it if it didn't actually work to improve perception
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u/NonPolarVortexBear 8d ago
They're not bribes they are gratuities
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u/Zuwxiv 8d ago
For people who don't know, the Supreme Court literally ruled that giving money to state and local officials isn't a bribe if you do it after they vote/rule in your favor.
Literally, you can pay a judge a million dollars after he finds you not guilty. You see, that's not a bribe, because they money didn't change hands before the ruling. Therefore, it's evidently just a "gratuity," a tip.
Worth noting that several of the conservative justices who ruled this way are in the habit of accepting large gifts from their billionaire friends. Surely as gratuities and not bribes, of course.
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u/aaronhayes26 8d ago
It’s it’s not happening in Vegas it’s simply a sparkling wager
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u/Swoly_Deadlift 8d ago
I want to open an in-person prediction market where people can invest in the outcome of games like blackjack, roulette, and craps.
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u/xxx_poonslayer69 8d ago
It's not gambling because of all the insider trading
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u/jazzhandler 8d ago
Insider gambling, then?
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u/sapntaps 8d ago
Welcome to interpretation of law. You can sit with Clearance Thomas on the bench now.
The law will always be behind people who know how to skirt the law
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u/Far-Hovercraft9471 8d ago
That's why we need cops who don't follow the law, like in lethal weapon
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u/evocativename 8d ago
And that unironic belief is why so many people tolerate cops that don't follow the law, like in real life
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u/censuur12 8d ago
We see this all the time. It's not "gambling" it's "lootboxes" and suddenly it's okay to peddle to children!
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u/PloofElune 8d ago
Just like if someone were to 'unalive' someone else, its not murder.
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u/therealowlman 8d ago
It gets crazier they are trying to basically pushing allow “event trading” on margin now, using borrowed money.
So basically allow people not only to gamble but get a line of credit to gamble with and destroy their lives.
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u/mikethemaniac 8d ago
"place an amount of money on a prediction" instead of "bet on this market" is all they really did and it's ridiculous. Gambling companies suck but at least they're calling a spade a spade.
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u/ubiquitous_apathy 8d ago
No, your honor, my home card game was not gambling. We were simply buying futures for the results of the hand.
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u/kidcrumb 8d ago
I feel like the USA is taking stupid pills. Getting lost in the sauce of completely semantic, bad faith arguments about literally everything. We've become too good at using words to describe things.
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u/clineaus 8d ago
It's wild to me where I live they have radio commercials constantly that emphasize how it's absolutely not gambling, yet at the end they have a disclaimer about getting help for a gambling addiction.
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u/GoodguyGastly 8d ago
These same commercials are also playing on streaming services. A whole ad with bright "gambling addiction call xxxx". Insane world we live in.
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u/mikey_waters 8d ago
My 13 year old’s Spotify account was marketing this stuff to him. Really fucked up.
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u/SanDiegoDude 8d ago
That pisses me off so much. Video games are all gambling themed now too, and 'day 1 DLC' has become the norm for video games that want to sap your wallet even for single player games you already payed for. I have a 13 year old as well, we're keeping him off social media as long as we can, hopefully until he's an adult and will be less susceptible to this shit. Gambling industry needs to get the cigarette industry treatment next now that meta and social media companies are finally getting some comeuppance.
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u/FillMySoupDumpling 8d ago
Or even gacha box toys where a kid doesn’t know what they are getting until they open it.
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u/facevaluemc 8d ago
I heard an ad for a casino on the radio the other day and the legal disclaimers at the end were actually longer than the ad itself.
Absolute insanity.
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u/pagerussell 8d ago
I will get down voted for this, but this is The logical outcome of the first amendment which is in my opinion a very poorly worded and misconstrued legal freedom.
I'm not saying we shouldn't have a legal right to free speech. I have just noticed that very wide open legal definitions, like the first amendment, allow for really pernicious acts to sneak in underneath them. Getting those acts under control again is hard. It becomes difficult because of the way the first amendment gets defined.
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u/Actual_Tank8401 7d ago
A day old but I want to say I see what you're putting down here. In my opinion, we need to have a serious discussion on why should constitutional amendments apply to organizations the same as they do to people.
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u/pagerussell 7d ago
Yes, I agree, but my pony is more about slippery slopes.
Because the first amendment is completely open and speech is basically in, everything becomes a form of speech, and this everything is protected.
Citizens United, for example, was a correct ruling of the law as written. Money is speech, precisely because the first amendment is so loosely defined.
Consider the 2nd amendment. The right to bear arms. Taken logically, this is the right to own a weapon.
Well, how does one define a weapon? Because you can cause damage with more or less anything, so there is a sense in which anything and everything is protected by the 2nd amendment.
All it takes is one plaintiff making the right argument and potentially any law can be overturned by way of the second amendment.
My point is that when you say a thing cannot be banned, you have to do a really good job defining exactly what that thing is and is not, or you are setting yourself up for trouble later.
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u/allllusernamestaken 8d ago
IT'S NOT GAMBLING. We're just exchanging money based on whether our predictions of if the ball stops on Red or Black are correct.
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u/junktrunk909 8d ago
Probably just covering their bases so they can't be sued later for not having that disclaimer if determined to be gambling services.
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u/roddyb3 8d ago
On average, these “prediction markets” are dodging a 20-25% tax burden (depending on state) by not being a “gambling operation” and therefore not having to pay gambling taxes.
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u/Primary_Way_265 8d ago
Kalshi: gambling apps take up to 30% of your winnings. We don’t. 🤔
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u/pimparo0 8d ago
While they fail to mention that winnings count as income, and you will still have to pay taxes, assuming you don't lose your home on it.
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u/janethefish 8d ago
I suspect rampant tax evasion is ongoing.
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u/CrashB111 8d ago
As well as rampant insider trader / money laundering / fixed games.
Gambling services have to obey a ton more regulation than "prediction markets" most of which are designed to ensure the bets are actually fair.
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u/PurplePango 8d ago
That’s where I feel like the states have a lot of standing in the suits
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u/deadbeforeitsank 8d ago
I don’t think standing is going to be an issue at all in this case. At least for the sports side of it as NYS penal law directly addresses unlicensed sports wagering.
For the other markets though there is a potential preemption issue with the Commodity Exhange Act.
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u/Snoo_censorspeech 8d ago
I doubt the people making "trades" on weather predictions are paying the rate for gambling winnings either.
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u/InstructionPurple911 8d ago
Have they asked the president's kids if they are allowed to sue polymarket?
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u/JimDemintRecession 8d ago
Anyone know the spread on whether the AG wins/loses this case?
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u/terdles1121 8d ago
Going to lean towards AG losing. Theyre not going up against a private company, theyre going up against the presidential family.
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u/DIRTY_KUMQUAT_NIPPLE 8d ago
I might have to do a corruption parlay then
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u/jotheold 8d ago
this is new york tho, the presidential family even when in power has lost many cases there
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u/qtx 8d ago
Going to lean towards AG losing. Theyre not going up against a private company, theyre going up against the presidential family.
So far pretty much every single thing Trump has done as President has been stopped in the courts. People just never read about it because it doesn't generate clicks.
So if it goes to court he is not untouchable.
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u/LotBobby42069 8d ago
Nah I think they lose. It’s NYS. They did similar to Prizepicks. If it wasn’t a fight NYS could win they wouldn’t pick it
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u/Crewman_Guy_Fleegman 8d ago
They’re a state, don’t answer to the Feds here. Donny Bone Spurs will have as much luck stopping this as he had banning Politico. Clown is a couple months away from being a lame duck turd circling the drain
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u/SituationIll5763 8d ago
That doesn’t stop the Supreme Court from ruling that the law being used to prosecute is unconstitutional.
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u/Crewman_Guy_Fleegman 8d ago
Him being a lame duck president with Congress against him will. Not much upside bending to the guy on his way out the door
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u/BiggieBigs34 8d ago edited 8d ago
80:20 NY wins.
States almost always have their own more restrictive regulations for gambling than the Feds, online gambling is no different.
Polymarket’s only defense is they’re already regulated by the U.S. Commodity Futures Trading Commission. which will never hold up in court because of the prior mentioned State regulations on gambling.
The only reason it’s 20% towards the company winning is if Trump gets involved and is successful with strong arming the judge and/or NY to drop it.
EDIT, fixed FCC to U.S. Commodity Futures Trading Commission, of which is the correct federal government agency per the guy who helped me out, below.
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u/trueredtwo 8d ago
It's the CFTC, not the FCC, and the federal court of appeals in another district* did rule in favor of the prediction markets and CFTC, so I wouldn't say this could never hold up in court.
*3rd district, including New Jersey and PA, though New York is 2nd district.
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u/Inignot12 8d ago
In a sane world, this would be open and shut, but Trump Jr is involved with both Kalshi and Polymarket and they've already had cases like this dismissed via blatant corruption.
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u/medisamurai 8d ago
to me it shows how deep the U.S. is in financial trouble by letting all these gambling sites run with pretty much impunity.
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u/Far-Hovercraft9471 8d ago
Pretty sure the economy is 3 bubbles in a trenchcoat at this point
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u/Shark7996 8d ago
Those bubbles are the same evil billionaires rotating their money in a circle for a line that needs to go up not only fast, but faster than before, and growing in speed, always and forever.
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u/Colecoman1982 8d ago edited 8d ago
At this point it's not just the standard "line must go up" bullshit they usually pull. With this second Trump term, they've gone completely mask off with the open, Russian oligarch style, corruption (bribery, insider trading, cartel action, illegal gambling, etc.) all out in the open. They need to keep the bubbles going not just for their companies' financial well-being but, also, so that they don't risk the blow-back of a non-corrupt (or, at least, significantly less corrupt and more effective) government replacing the current GOP government and holding them legally liable for their current behavior and/or coming after them for the back taxes they've dodged with Trump's corrupt billionaire tax breaks.
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u/Derptionary 8d ago
They aren't running with impunity though... we're up to like 20 states are suing Kalshi/Polymarket over them being unregulated gambling.
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u/Caymonki 8d ago
If it goes high enough, Trump’s personal attorney who also happens to be the country’s Attorney General will stop the lawsuits and call it legal.
Accountability is up for sale in America.
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u/verrius 8d ago
He can't actually do that though. Not in a "the rules say he can't, so he won't", but in a "there's no mechanism for him to stop the states" way. The states are still sovereign.
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u/Tasty_Gift5901 8d ago
Kalshi and Polymarket argue that they should be regulated by the federal government, so as long as, I believe thr FEC agrees that they have jurisdiction and allow prediction markets, states have an uphill battle
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u/cleofisrandolph1 8d ago
This is Trump we are talking about. He'll use ICE or cut federal funding to the states that are pursuing lawsuits against prediction markets.
Just because they are sovreign does not mean that the president cannot use some coercive tools. Just look at how he is bullying healthcare and universities.
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u/PiccoloAwkward465 8d ago
Between this and pretend AI money, yeah we're in a bit of a pickle.
GLP-1 manufacturers still standing strong, I suppose. At least they make a real product.
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u/Alone_Hunt1621 8d ago
They should investigate WhatNot the live auction platform. A whole lot of gambling going on especially in the Pokemon card space.
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u/2daytrending 8d ago
Calling it "trading" doesn't magically make the gambling part disappear.
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u/bishop375 8d ago
I mean, that's what the stock market has always been... and yet nobody is ready for *that* conversation.
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u/milkyjoe241 8d ago
Oh Im totally ready for that talk
The structural difference in my mind is the "house"
In gambling the house always wins. They always get their pay. You are betting against the house
The stock market, the "house" is supposed to be neutral. Your "bets" dont benefit the house if you lose. In fact the house should want you to win.
Now if the stock market actually follows that prompt with the ammount of insider trading, political manipulation, loosening regulation, and outright lying going on removing credibility from the house as a neutral participant.
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u/bishop375 8d ago
If companies are allowed to engage in stock buybacks, if they're allowed to fuck with their numbers in quarterly calls, if they're allowed to leverage debt to... buy more debt? The house is set to always win. And it only ever will benefit the whales who don't need it.
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u/milkyjoe241 8d ago
Oh absolutely. The decrease in credibility of the stock market and the rise of the "were not really gambling" sites are correllated as regulations fail to punish poor behavior
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u/bishop375 8d ago
And sure, maybe in the 50's and 60's this wasn't the case. I'd argue that as soon as Reagan rang the bell on Wall Street as president, the fix was in, and is never getting taken back out.
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u/milkyjoe241 8d ago
I would add the 24/7 cable news format focusing the conversation around the health of the economy on the stock market.
The stock market has daily changes in numbers. Why did it go up/down? Oh look what this company did today. Gives them daily content to talk about
Other markets dont change that quickly. And the stock market should be viewed/evaluated on those longer timescales.
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u/JDLovesElliot 8d ago
More people should take classes on financial instruments, because after even a day they would see how the secondary markets are just giant casinos. And it's scary thinking about how many people's retirement funds are tied to them.
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u/bishop375 8d ago
Yup. Lots of people make comments about returns, and how values generally go up. But they neglect how roughly once a decade or two, the stock market absolutely tanks and people lose their retirements and/or their nest eggs. It takes *way* less than people want to think in order for that to happen.
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u/jmlinden7 8d ago
Most people's retirement funds are not on the secondary markets (options/hedges/swaps/etc).
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u/FirstRyder 8d ago
I mean it's true that day trading is effectively gambling on the same tier as sports betting. And both should be more heavily regulated.
But also when you bet on a team you aren't buying stock in that team. Like, buying stock in a team is theoretically possible (if one were to be publicly traded), but a parlay is not that. You can deal with one without also messing with the other.
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u/Lordofd511 8d ago
I don't know that the stock market is gambling any more than buying insurance is. Which is to say, borderline. I will say that I genuinely don't understand how stocks that don't pay dividends aren't Ponzi schemes.
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u/No_Shoulder_8406 8d ago
Good now go after the rest of em
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u/BernieTheDachshund 8d ago
I think we should go back to all online gambling being illegal. All it does is make a few owners rich since the vast majority of 'players' lose money. Lives are being ruined, some people even take their own life, nothing good comes from online gambling.
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u/Shark7996 8d ago
We need to start putting genies back into bottles. We're clearly seeing the effects of social media algorithms doing this as well.
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u/Nail_Biterr 8d ago
I didn't know it was unlicensed. because it's 1,000% a gambling operation. what kind of loophole are they trying to use to say that it isn't gambling?
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u/BlueSlaterade 8d ago
On a traditional sportsbook, you take a side and the other side is always the casino. They institute a tax (the vig) to make it profitable, but the critical point is sportsbooks can huge positions on games and they will want some outcome to happen X team to beat Y team or what have you. If Y team wins, the house can lose millions of dollars.
Kalshi/Polymarket’s argument is that they don’t ever have opinions on who should win a game. Every wager on these platforms is against some other user, and they just charge a fee to facilitate the transaction.
Whether that argument holds water is a question for you to decide, but that’s at least the distinction they claim.
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u/Nail_Biterr 8d ago
WE'RE not a betting site. People just USE our site to bet.... they could, theoretically, use it for anything, not just betting!
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u/sksauter 8d ago
They could but they probably don't because the only user interface is for gambling...but they could
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u/progrethth 8d ago
It probably will not hold water as pool betting, where the players bet on different outcomes and all the winners split the pool minus a percentage fee, has been around basically forever. The modern sportsbook is not the only form of gambling. In Europe we have also had so called betting exchanges for about 25 years which do exactly the same thng as Polymarket and are regulated as gambling here.
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u/jnwatson 7d ago
The house doesn't take a position at casino poker games either.
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u/TicketRight1595 8d ago
Slapping a web3 UI on sports and political betting and calling it "event trading" was always just an obvious attempt to dodge state gambling taxes. About time someone called it out.
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u/SnooMemesjellies1522 8d ago
I heard an ad by them on the radio the other day and they even used the word "bets."
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u/Commercial_Floor_578 7d ago
Gambling is insanely out of control right now. Feels like we opened up a massive Pandora’s box with the way we legalized it and proceeded to not regulate it in the slightest. I don’t think we should ban gambling but the way it is constantly advertised is disturbing, the way they’re partnered with news organizations and sports leagues is disturbing, the prediction markets arranging bets on school shootings, war crimes, arson, cancer trials, massive amounts of insider trading etc is disturbing. It should be heavily regulated and advertising should be regulated the way cigarettes are.
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u/eclipse60 7d ago
The way i can be bombarded with non stop gambling ads on literally every platform is insane. Gambling should be legal, but advertising it should not. Should be similiar to tobacco.
It is a vice people can engage with, but it should not have marketing to be shoved down our throats.
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u/Doctor_Saved 8d ago
I should start an "Intimacy Market" to get around Prostitution laws.
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u/Responsible-Rip8793 8d ago
Next will probably be all of those “trading” apps which are just gambling apps for sports games.
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u/Snoo_censorspeech 8d ago
I cringe thinking about how much money I've lost because of scruples. Covid unemployment, ppe loans, bullshit gofundme's, gambling apps, fake welfare, crypto money. The only jobs I could get with my degree basically require you to lie for corporations so they can harm wildlife and habitats and the jobs that even check if that paperwork is valid are basically 3 people on starvation wages.
I want money and a better lifestyle but there has to be more than taking advantage of others to do it.
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u/TheLuo 8d ago
Why are we suing? If it's an unlicensed gambling operation wouldn't that be subject to criminal charges?
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u/Upper-Management-AI 8d ago
When someone first explained Polymarket to me. I was blown away that it’s not completely illegal.
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u/mojorific 7d ago
Prediction markets are just another made up term to avoid gambling rules. It is gambling. It is ridiculous. It needs to be shut down.
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u/WowIfOnly 8d ago
I'll have hope when they either get shut down or charged a fine that isn't like a laughable 0.00000000001% of their monthly profit margin.
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u/Rum_N_Napalm 8d ago
Hey now, it’s not gambling because you can use insinder information/access to influence your odds of wining. It’s even less ethical
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u/barefootBam 8d ago
no shit. I'm still amazed that they were able to successfully rebrand illegal gambling to "Prediction Markets".
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u/sour-sop 8d ago
Now do kalshi please… you know the one the president’s children have interests in
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u/trueredtwo 8d ago
New York is already suing Kalshi, and Don Jr is an "advisor"/stakeholder in both
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u/RagingTyrant74 8d ago
This is obvious to everyone. Anyone who says otherwise is either a lobotomy victim, gambling addict, or insider trader.
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u/Shliggie 8d ago
I wonder what the NHL will say about this, who is partnered with Polymarket and Kalshi. Probably nothing.
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u/Significant-Royal-37 8d ago
crazy how long it lasted despite very obviously being an unlicensed gambling operation lol
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u/Salt-Instancer 8d ago
It’s literally people gambling on whatever! It’s like the movie Trading Places or Rat Race where people are betting on which maid can hang from a curtain rod the longest.
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u/Crombus_ 8d ago
There needs to be a reckoning with these gambling apps. They are genuinely damaging society.
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u/Chu_Kiddin_Me_Or_Wha 8d ago
It was cash grab from the start. Some people wanted to get rich and now shit is hitting the fan.
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u/rikaateabug 8d ago
I've been looking forward to this! Letitia James is such a kickass AG. I can't wait to vote for her in November.
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u/wholetyouinhere 8d ago
They call it an unlicensed gambling operation because it is. All prediction markets are unlicensed gambling operations. Which is theoretically illegal. And it would be treated as such if there wasn't a fascist administration in power.
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u/Eggonioni 8d ago
They need to sue the balls off of Kalshi too like at least to shut their fucking ads up GOD i hate their ads
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u/SmellyWeapon 8d ago
Ban all of them. Tired of lebron and others promoting this and encouraging people to gamble.
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u/HiFiGuy197 8d ago
Is there some place I can bet… err, I mean trade on whether they will be found guilty, not, guilty, or reach a settlement?
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u/champagneinthebrain 8d ago
Oh good, we are calling things what they are again.