Is Polymarket legal in New York?

The attorney general brought the case as a verified petition under Executive Law § 63(12), which lets the attorney general's office ask a court to stop "repeated fraudulent or illegal acts" in a business (p.5, ¶18). The office announced it with Governor Hochul. There is one respondent, QCX LLC (d/b/a Polymarket US), which the petition calls a Delaware company with its principal place of business in New York City (p.5, ¶16). Blockratize and the international polymarket.com are not named as parties, though the petition says QCX runs its platform "along with its parent corporation and affiliates" (p.1, ¶4).

The state's theory, in the petition's words: "Each contract is a bet" (p.12, ¶43), and QCX "is not licensed with the New York State Gaming Commission in any capacity" (p.3, ¶11). It lists seven violations, lettered (a) to (g): (a) Article I, § 9 of the state constitution; (b) Penal Law §§ 225.05 and 225.10; (c) Penal Law § 225.20; (d) Racing Law § 1367(16)(a); (e) Racing Law § 1367-a(2)(a); (f) Racing Law § 1367-a(4)(b); and (g) the federal Wire Act (pp.3-4, ¶13).

Polymarket US filed a notice of removal the same day, moving the case to the U.S. District Court for the Southern District of New York as James v. QCX LLC, No. 1:26-cv-08338 (p.1). Its argument is that event contracts are a type of swap (p.2, ¶2), and that the Commodity Exchange Act gives the CFTC "exclusive jurisdiction" over swaps traded on a designated contract market (p.5, ¶11). The CFTC designated QCX a contract market on July 9, 2025 (order).

Polymarket US's notice also says the attorney general "has moved the court for a temporary restraining order" (p.7, ¶18). That comes from the notice alone: the petition's own requests ask for permanent relief (pp.29-31). Neither federal order entered since grants a restraining order, and whether the state court acted on the request is not confirmed.

Judge Ronnie Abrams has the case, together with a related one Polymarket US filed, QCX LLC v. James, No. 26-CV-8345 (September 30 order).

Nothing yet. Everything below is a request to the court, and neither federal order entered so far grants any of it.

The injunction New York asks for is not limited to sports. It would bar QCX from "operating a business that offers contracts relating to sports, culture, elections, and other events" without the Gaming Commission's licenses (p.29, request A.a). The petition's own examples range from an NBA Finals contract on the Knicks and the Spurs to the "New York Governor Election Winner" and a week-four elimination on "Big Brother Season 28" (pp.1-2, ¶5).

Two narrower requests sit under it: no trading by anyone under 21 on those contracts, and no advertising for them, including "on college or university campuses" (pp.29-30, requests A.b and A.c).

The money it asks for: an accounting, restitution, damages and disgorgement; a penalty of three times QCX's gain under Penal Law § 80.10; $100,000 for "each offering or attempt to offer sports wagering or mobile sports wagering" without authorization under Racing Law § 1367(16)(a); prejudgment interest; and $2,000 in costs (pp.30-31, requests C to J).

No order we have found in the New York case says anything about accounts, deposits, withdrawals or open positions. The two federal orders entered so far are about scheduling.

Two of the petition's requests do reach customers. It asks for an accounting "identifying each of its customers" and what they lost, and for "full restitution to customers who have engaged in betting" on the platform (p.30, requests C and D). Neither federal order acts on them.

The international site, polymarket.com, is a separate matter from this case. Polymarket's own documentation lists the United States under close-only jurisdictions: "Users can close existing positions but cannot open new ones, on both the frontend and the API" (Polymarket docs). That covers the whole country rather than New York, and the petition doesn't name the international site.

The open question is which court hears it. On September 30 Judge Abrams told the parties in both cases to say in a joint letter whether they wanted an initial status conference or a stay "pending the resolution of" three Second Circuit appeals: KalshiEX LLC v. Williams (No. 26-1835), KalshiEx LLC v. Cafferelli (No. 26-2239) and Coinbase Financial Markets v. Tong (No. 26-2297) (ECF 7).

The attorney general then moved to send the case back to state court (Dkt. 14). On October 9, with the joint letter in, the judge ordered the parties to "confer and propose a briefing schedule" for that motion, and said no initial status conference would be set while it is pending unless they ask for one (ECF 18). Neither order stays the case. We haven't confirmed the rest of the docket.

Two other things touch Polymarket in New York. Neither is the state enforcing its law.

Private class actions. Two proposed class actions were filed in the same federal court in February 2026: No. 1:26-cv-00973 on February 4 (complaint) and No. 1:26-cv-01160 on February 11 (complaint). Both name Blockratize, Adventure One QSS and QCX LLC as defendants, and the second adds QC Clearing and QC Tech. Each asks to represent several classes of customers, a New York class among them (No. 1:26-cv-00973, p.25, ¶96; No. 1:26-cv-01160, p.37, ¶168). Private plaintiffs brought them, not the state. We have read the complaints only, so whether either case has a ruling is not confirmed.

A City Council inquiry. On August 12, 2026 the New York City Council opened an inquiry into how Kalshi, Polymarket, Coinbase and Gemini Titan market themselves; its release says "Speaker Menin notified four platforms". It is not a lawsuit and orders nothing.

New York sued Kalshi first, on July 31, 2026, when the attorney general announced a suit against KalshiEX, filed like this one as an Executive Law § 63(12) petition in New York County Supreme Court. Kalshi had separately asked a federal court to stop New York's Gaming Commission. On July 7 Judge Analisa Torres denied its motion for a preliminary injunction (opinion), and Kalshi appealed: KalshiEX LLC v. Williams, No. 26-1835, is one of the three appeals Judge Abrams named on September 30. Kalshi's status in every state is tracked the same way.

The case doesn't decide how event contracts are taxed, and we have found no IRS guidance on them. Polymarket taxes covers the forms, and prediction market taxes the common ways people file. Every other state's Polymarket status is on the Polymarket legal page.