Crypto.com Prediction Exchange Seeks Federal Shield Ahead of Washington Crackdown

OG invokes CFTC’s Michigan intervention

North American Derivatives Exchange Inc., which does business as OG Prediction Markets and Crypto.com | Derivatives North America, filed a federal lawsuit Wednesday seeking to prevent Washington officials from applying state gambling laws to its event contracts. The CFTC-regulated exchange named Attorney General Nick Brown and members of the Washington State Gambling Commission as defendants in the Western District of Washington.

OG is the standalone prediction-market platform launched by Crypto.com on Feb. 3. The platform offers sports, political, financial, cultural and entertainment contracts through the exchange Crypto.com markets as Crypto.com | Derivatives North America, an affiliate registered with the Commodity Futures Trading Commission as a designated contract market and derivatives clearing organization.

The lawsuit does not follow a cease-and-desist order or enforcement case against OG. Instead, the exchange says Washington’s public position and its recent injunction against Kalshi create a “concrete and imminent threat” that officials will target OG next. Washington has maintained since December 2025 that offering or participating in event-contract markets is unauthorized within the state.

OG asks the federal court to declare Washington’s gambling laws unconstitutional and preempted as applied to its exchange. It also seeks a permanent injunction barring Brown and gambling commissioners from enforcing wagering laws against OG, but the complaint does not show that the company has already obtained temporary or preliminary protection.

The exchange argues that Congress gave the CFTC exclusive jurisdiction over transactions on designated contract markets, creating a uniform national derivatives system that states cannot override. OG says withdrawing from Washington would produce unrecoverable revenue losses, weaken its position against competing exchanges, and create a state-by-state regulatory patchwork incompatible with its federal obligations.

Its complaint relies heavily on the CFTC’s July 14 intervention in Michigan. The agency blocked Kalshi from cancelling previously executed sports contracts after a state court ordered them voided and refunded, directing the exchange to fulfill the trades normally. The CFTC said forced unwinding could distort prices and weaken confidence that completed derivatives transactions will remain enforceable.

OG also advances a commercial defense of sports contracts, arguing that broadcasters, merchandise retailers, hospitality businesses, restaurants and fantasy operators may use them to hedge revenue tied to sporting outcomes. The complaint offers hypothetical use cases, however, and does not identify businesses currently using OG contracts for those purposes.

The exchange previously sued Nevada regulators in September 2025 after receiving a cease-and-desist, and a federal judge denied its preliminary injunction the following month, prompting Crypto.com to pause Nevada sports contracts and appeal to the Ninth Circuit. In June, it filed a near-identical complaint against New York Attorney General Letitia James and the New York State Gaming Commission. OG is also the second operator to sue Washington on imminent-threat grounds, after Robinhood.

Washington’s state court reached the opposite conclusion in Kalshi’s case, finding that the Commodity Exchange Act does not prevent states from defining and enforcing illegal gambling. Federal courts remain divided: the Third Circuit shielded Kalshi in New Jersey, while courts in several other states have allowed local restrictions to proceed. Gambling attorney Daniel Wallach counts states winning 19 of 23 decisions on preliminary injunctions and restraining orders in prediction-market cases.

OG’s lawsuit attempts to secure federal protection before Washington repeats its Kalshi enforcement strategy. The filing does not resolve whether its contracts are derivatives or gambling, but it extends the federal-state jurisdictional fight to Crypto.com’s expanding prediction-market business.