Connecticut Regulators Crack Down: Kalshi, Robinhood, Crypto.com Ordered to Halt Sports Betting Markets

Connecticut banking authorities have issued cease-and-desist orders to three prominent financial platforms—Kalshi, Robinhood, and Crypto.com. The state's Department of Banking alleges these companies are offering event-based contracts that constitute illegal sports wagering under Connecticut law, rather than permissible financial predictions. The regulators specifically targeted prediction markets on platforms like Kalshi, which allow users to speculate on event outcomes. While Robinhood and Crypto.com are primarily known for stock and cryptocurrency trading (including major coins like BTC and ETH), their involvement in such markets has drawn regulatory scrutiny. This enforcement action highlights the ongoing tension between innovative fintech products and existing gambling regulations, signaling a stricter oversight environment for trading platforms operating in or accessible from Connecticut.