Tennessee sends cease-and-desist letters to Kalshi, Polymarket, and Crypto.com

Tennessee has sent three cease-and-desist letters to prediction markets, Kalshi, Polymarket, and Crypto.com, demanding an immediate end to operations.

Three major prediction markets have been instructed to cease operations in Tennessee, after the Tennessee Sports Wagering Council sent cease-and-desist letters to Kalshi, Polymarket, and Crypto.com. As shared by gambling lawyer David Wallach, the letters state that each of the three prediction markets are not compliant with Tennessee laws and represent “an immediate and significant threat to the public interest of Tennessee.”

BREAKING: Tennessee Sports Wagering Council sends cease-and-desist letters to Kalshi (), Polymarket and Crypto, demanding that they cease offering sports event contracts to TN customers immediately, void all pending contracts and issue refunds by Jan. 31. Lawsuits are imminent. pic.twitter.com/jDIPIwsrCn

— Daniel Wallach (@WALLACHLEGAL) January 9, 2026

“The sports events contracts offered on Kalshi’s exchange are not compliant with [Tennessee’s gambling] protections (and many others) and are an immediate and significant threat to the public interest of Tennessee,” reads the letter to Kalshi, with similar wording for the other two letters. “Even if it did offer these protections, Kalshi does not have the required license issued by the SWC and does not pay the privilege tax mandated by statute.

“To that end, the SWC demands that Kalshi cease offering sports events contracts to customers in Tennessee immediately, void all pending sports events contracts that were entered into by any person located in Tennessee, and refund all funds on deposit to any person located in Tennessee no later than January 31.”

Kalshi responds to the Tennessee decision

Kalshi has responded to the move from the Tennessee Sports Wagering Council in a statement reported by betting analyst Bill Sperros.

Response From @Kalshi:

“As other courts have recognized, Kalshi is a regulated, nationwide exchange for real-world events, and it is subject to exclusive federal jurisdiction. It's very different from what state-regulated sportsbooks and casinos offer their customers.

Tennessee… https://t.co/rmUzOholOA

— Bill Speros (@billsperos) January 10, 2026

“As other courts have recognized, Kalshi is a regulated, nationwide exchange for real-world events, and it is subject to exclusive federal jurisdiction,” said the prediction market operator. “It’s very different from what state-regulated sportsbooks and casinos offer their customers. Tennessee has nevertheless sought to regulate Kalshi under state law. It sent us a cease-and-desist letter earlier today, and we have now brought suit in federal court to stop this unlawful attempt.”

This isn’t unusual territory for Kalshi, having filed lawsuits in other states like Connecticut to push back on similarly-minded lawsuits. Crypto.com and Polymarket have had their own share

Readwrite has reached out to Kalshi, Polymarket, and Crypto.com for further comment.

Featured image: Composite image from Kalshi, Polymarket, Crypto.com

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