A Nevada state court has declined to immediately shut down Coinbase’s newly launched prediction market products, dealing an early setback to state gaming regulators seeking swift action against the crypto exchange.
The court denied the Nevada Gaming Control Board’s (NGCB) request for an emergency temporary restraining order (TRO) and instead scheduled a hearing for next week, giving Coinbase time to respond formally. Coinbase’s Chief Legal Officer Paul Grewal confirmed the decision in a post on Thursday.
Yesterday the Nevada Gaming Control Board tried to get a NV state court to stop us ex parte from listing there any event contracts, sports-related or otherwise, without any opportunity for us to be heard. Today that court said no, after we argued that due process requires at a…
— paulgrewal.eth (@iampaulgrewal) February 5, 2026
The NGCB had filed a civil enforcement action in Carson City on Monday, accusing Coinbase of offering unlicensed sports betting through event-based contracts and urging the court to block access to the products for Nevada residents.
Coinbase says state action overreaches federal authority
In its response, Coinbase argued that Nevada’s requested order went far beyond sports wagering and would effectively prohibit all Commodity Futures Trading Commission (CFTC)-regulated event contracts in the state, including those tied to financial or commodity outcomes.
The exchange also pushed back on claims of irreparable harm, noting that Kalshi, the CFTC-registered prediction market whose contracts Coinbase lists, remains free to offer the same products directly to Nevada users while the case plays out.
Coinbase has now escalated the dispute to federal court in Nevada, seeking to halt the state’s enforcement effort. Grewal said the move is necessary to defend federal regulatory authority.
States intensify scrutiny of prediction markets
In its legal filings, Coinbase maintains that the Commodity Exchange Act grants the CFTC exclusive oversight of event contracts traded on regulated exchanges, arguing that Nevada’s attempt to classify them as gambling is preempted by federal law.
The legal fight follows a separate Nevada ruling last week, in which a judge granted a 14-day TRO requiring Polymarket to suspend certain event markets in the state.
Additionally, a federal judge temporarily blocked Tennessee regulators from taking enforcement action against prediction market platform Kalshi, allowing the company to continue operating in the state while its legal challenge proceeds.
Meanwhile, Coinbase and Kalshi have previously sued regulators in Connecticut, Illinois and Michigan, challenging state efforts to restrict prediction markets they say fall squarely under federal jurisdiction.
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