Crypto.com’s OG Sues Washington After Kalshi Injunction

Jonathan Rodriguez

Written by: Jonathan Rodriguez

Published: Mon Jul 27, 2026, 8:00 am ET

Read Time: 5 minutes

Crypto.com’s OG Sues Washington After Kalshi Injunction

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Crypto.com-owned North American Derivatives Exchange (Nadex), operating under the OG brand, has sued Washington state officials. The company filed its complaint after a judge granted a preliminary injunction against prediction market operator Kalshi.

The lawsuit seeks to prevent Washington from applying its gambling laws to OG's federally regulated event contracts. The case adds another major dispute to the growing conflict between prediction markets and state regulators.

It also raises questions about whether event contracts fall under federal commodities regulation or Washington gambling laws.

OG Challenges Washington's Potential Enforcement Action

Nadex filed the lawsuit in the U.S. District Court for the Western District of Washington on July 22. The complaint came two days after Judge John McHale granted Washington's preliminary injunction against Kalshi.

OG sued Washington Attorney General Nick Brown and members of the Washington State Gambling Commission (WSGC). The company seeks declaratory and injunctive relief against potential enforcement action.

OG argues that Washington could take similar action against its event contract operations. The company points to the state's legal action against Kalshi and the arguments officials made during that case.

The company also argues that the Commodity Futures Trading Commission has exclusive jurisdiction over federally registered markets. Therefore, OG claims state gambling laws cannot override federal commodities regulation.

"Thus, there is a concrete and imminent threat that Defendants will take the same actions against OG as they did against Kalshi. Because the CFTC has exclusive jurisdiction over federally registered markets and intermediaries, Defendants' efforts to prohibit the trading of event contracts listed on federally regulated markets are preempted by federal law. OG is entitled to a judicial declaration that its activities are not subject to Defendants' oversight, regulation, or jurisdiction, as well as an injunction barring Defendants from any future enforcement efforts," counsel for OG wrote in the lawsuit.

Additionally, OG claims potential enforcement could cause irreparable harm. The company says removing Washington users from its platform could create unrecoverable losses.

Washington State's Stance

Meanwhile, Washington officials have taken the opposite position. The Attorney General's Office has argued that unregulated event contracts can constitute illegal wagers under state law.

The state has maintained that staking something valuable on a future contingent event can constitute gambling. Regulators also argue that the products can function like unlicensed sports betting.

Attorney General Nick Brown has described early rulings against prediction markets as "a step toward holding platforms accountable for brazen violations of Washington law."

OG Highlights Commercial Uses for Sports Contracts

OG also argued that sports event contracts can serve commercial purposes beyond recreational wagering. The company cited broadcasters, merchandise retailers, hotels, restaurants, promotional companies, fantasy sports operators, and sports data providers as potential users.

"These are just a few examples, but they underscore a broader point," the complaint states. "Many businesses across diverse industries have meaningful financial exposure to the occurrence, non-occurrence, or extent of occurrence of events or contingencies connected to sporting events and may seek to manage that risk through event contracts."

Washington, however, argues that sports contracts can function as unlicensed sports betting. State officials contend that these products can bypass licensing and consumer protection rules governing legal US online sportsbooks.

That disagreement remains central to the case. OG views the contracts as federally regulated financial products, while Washington gambling authorities argue that their practical use can make them wagers under state law.

Washington's Kalshi Ruling Sets the Legal Backdrop

Judge John McHale's ruling against Kalshi provides the immediate backdrop for OG's complaint. The court granted Washington a preliminary injunction after finding that Kalshi's activities presented a likelihood of substantial harm to state consumers under Washington gambling and consumer protection statutes.

Washington argued that Kalshi's event contracts allowed users to wager on sports outcomes without complying with the state's licensing requirements. The state also raised concerns about consumer protections that apply to regulated gambling operators.

The ruling strengthened Washington's position against prediction markets offering sports-related contracts. It also created concern among other operators that the state could pursue similar enforcement actions.

OG's lawsuit therefore seeks to resolve the federal preemption issue before Washington takes direct action against the company.

Prediction Market Operators Continue Suing After Injunctions

OG's lawsuit follows a growing trend among prediction market operators and their partners. Companies have increasingly filed federal lawsuits after states target rival platforms.

Robinhood sued Washington after the state took action against Kalshi. The company also previously challenged Massachusetts officials after that state launched its own Kalshi case.

Polymarket likewise filed a federal lawsuit against New Mexico after the state sued Kalshi. These cases show how enforcement actions against one operator can quickly trigger defensive lawsuits from others.

The direction of OG's case will likely depend on whether a federal court accepts its preemption argument. Washington, meanwhile, will likely maintain that state gambling laws apply to event contracts offered to residents.

If OG wins, the ruling could strengthen prediction market operators' efforts to block state-level regulation. If Washington prevails, the decision could create another obstacle for platforms offering sports contracts.

The case could therefore become an important test for the future of prediction markets. It may also influence how regulators define the boundary between event contracts, sports betting, and broader financial products.

For now, the dispute adds another layer to the growing conflict between prediction markets and state gambling authorities. It also shows why the legal framework surrounding US online sportsbooks and event contracts remains unsettled.

As Washington continues its case against Kalshi, OG is seeking to stop a similar fight before state officials take direct action. The lawsuit could ultimately determine how far Washington gambling laws extend into federally regulated prediction markets.

Jonathan Rodriguez
Jonathan Rodriguez

Jonathan is an avid basketball fan, and is often looking forward to the next upcoming NBA season when not checking players' stats during games. He also likes to keep his ears on the ground for the latest rumblings in the online casino industry.

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