Is ProphetX legal in Connecticut?

Everything we found comes from a September 10, 2026 release from the governor's office. It says the Department of Consumer Protection "issued nine cease-and-desist orders" that week, then lists the targets. ProphetX is fifth, between Robinhood and Novig.

The release describes what all nine were told in one sentence. Each was told to stop "advertising, offering, promoting, or otherwise making available" sports event contracts, along with "any other form of unlicensed online gambling," to Connecticut residents. That sentence is the governor's office summarizing nine documents at once. It does not quote the order sent to ProphetX, and it does not say whether that order was tailored to ProphetX's products.

Most of what a reader would want to know. We found no posted copy of the September orders, and the release says copies "are available upon request" through its records portal. We have not obtained ProphetX's. So we cannot give:

• The date. The release says "This week," and it is dated September 10. The order's own date is in nothing we found.
• The addressee. The release prints "ProphetX" with no company suffix. Whether the order went to ProphetX LLC, the company holding the federal designation, or to another entity is unknown to us.
• The statutes and findings. Beyond the release's general wording, we found none.

The release itself uses two words for the documents. Its list calls them orders; its closing line calls them "cease-and-desist letters." A cease-and-desist from an agency is not a court judgment, and we found no court ruling that enforces this one or sets it aside.

For contrast, the department did publish its December 2, 2025 order to Robinhood Derivatives, one of three platforms it targeted that month. That two-page letter carries a case number, cites Connecticut's gambling statutes and the state unfair trade practices law, and names its addressee in full. We found nothing comparable for ProphetX.

The reasons in the release are about the industry, not about ProphetX. It describes a sports prediction market as "a peer-to-peer exchange where users buy and sell 'yes' or 'no' contracts" on sporting events, and says such markets operating in Connecticut violate its gaming and unfair trade practices laws. It adds that they take wagers from people under 21 and from people on the state's voluntary self-exclusion list, and that they offer wagers on Connecticut college teams, which state law forbids. It calls the nine "known to be operating illegally in Connecticut."

Those are the state's allegations. The release names no conduct by ProphetX in particular, and no court has made those findings about ProphetX in any record we found. On penalties, it warns that "Failure to comply may result in additional action," including civil penalties under the Connecticut Unfair Trade Practices Act or criminal penalties under the gaming statutes. That is a warning. We found no penalty imposed on ProphetX.

We could not determine it. Directly after the stop sentence, the release says the department "also ordered all three platforms" to let residents withdraw funds. The paragraph is about nine platforms and never identifies three.

The same withdrawal sentence appears in the attorney general's August 26, 2026 release, where it follows a description of December 2025 orders to "Kalshi and two other sites." The CFTC's complaint against Connecticut names those three as KalshiEx, Crypto.com and Robinhood Derivatives (¶60, p.18). ProphetX is not among them, and ProphetX LLC was not yet a designated exchange then. The published Robinhood order does contain a withdrawal term (p.2), but that tells us nothing about what the order to ProphetX says. This page does not apply the "three platforms" sentence to ProphetX.

The CFTC designated ProphetX LLC, "a Delaware limited liability company headquartered in New York," a contract market by an Order of Designation dated June 11, 2026 (p.1). In its application ProphetX said its trading model "is non-intermediated" (p.2), and the order bars it from letting a futures commission merchant intermediate trades unless the order is amended (p.3). In ProphetX's own description, then, users trade on its exchange without a broker in between. Two others on Connecticut's list work as brokers: the Connecticut court describes Kalshi's contracts as "offered through Coinbase" (ECF 93, p.4), and the CFTC calls Robinhood Derivatives a registered futures commission merchant (¶60, p.18).

The federal government's position on Connecticut's earlier orders is in its April 2, 2026 complaint (D. Conn. No. 3:26-cv-00498). The United States and the CFTC say they sued "in response to Defendants' sending of cease and desist letters to various CFTC-regulated entities" (¶1, p.1). The complaint was filed more than two months before ProphetX's designation and does not mention ProphetX. We found no filing or public statement in which ProphetX takes a position on Connecticut's order.

Not in any record we found, and ProphetX is a party to none of the Connecticut cases we know of. On August 10, 2026 the federal court in Connecticut denied Coinbase a preliminary injunction, "largely in line with" its companion order in Kalshi's case (ECF 93, p.1). On November 3, 2026 the Second Circuit denied Kalshi (No. 26-2239) and Coinbase (No. 26-2297) injunctions while they appeal, finding they "failed to make the required showing." We found no decision on the appeals themselves.

The release puts the August ruling more broadly, saying a federal judge found that sports event contracts "are illegal unlicensed gambling." That is the governor's office's description; the August rulings denied preliminary injunctions, in cases ProphetX was not in. We did not read court dockets for this page, so a filing involving ProphetX could exist that we have not seen. Kalshi in Connecticut follows those appeals.

We could not determine it. ProphetX's terms of use, version 1.0 dated June 10, 2026 and read November 11, 2026, make eligibility depend on users being "legally allowed to participate in the Contracts" under the laws that apply to them (§3.1), and require location services to be on (§8.5). They do not mention Connecticut. Its help center article on blocked access, last updated August 4, 2026, says access "is restricted from certain locations" without listing them, and a search of the help center for "Connecticut" on November 11 returned nothing.

So we found no ProphetX notice that it stopped, or kept, offering sports contracts in Connecticut after the order. Nothing we read speaks to balances, withdrawals or open positions for Connecticut users.

Yes, Ohio. Its Casino Control Commission sent a letter dated October 2, 2026 addressed to "Prophet X," demanding that it stop offering sports event contracts in Ohio. Unlike Connecticut's order, that letter is one we could read. ProphetX in Ohio covers it, and ProphetX's legal page lists every state where we found an action.

The department's order is about who may offer sports contracts in Connecticut without a state license, and a state gaming action is not a ruling on federal income tax. How a year of event contracts comes out under the common ways people file is in the prediction market tax guide.