Polymarket Halts New Michigan Sports Positions as State Restrictions Spread

Polymarket is preventing Michigan customers from opening new sports positions, adding another major platform to the state’s growing list of restricted prediction market offerings.

Michigan already secured agreements or court orders restricting sports event contracts offered through Kalshi, Robinhood and Coinbase. The platforms reached that position through different legal paths, and those restrictions have not resolved the underlying dispute over whether the state can regulate federally registered event contracts as gambling.

Customers received an email this week alerting them of Polymarket's recent move.

🚨 Polymarket is shutting down new sports trades in Michigan starting today pic.twitter.com/FpHm7d9x5X

— Chelsea (@ChelsElaina) October 26, 2026

Polymarket’s move extends the state's enforcement campaign, limiting Michigan customers' ability to open sports trades as the nationwide jurisdictional fight continues.

“Our efforts, alongside the Gaming Control Board, are making a clear impression on the executives of the illegal sports betting industry, and we’re glad to reach yet another agreement that protects Michigan residents,” Michigan Attorney General Dana Nessel said in a release earlier this month when Coinbase stopped its sports offerings. “Michigan gaming law is simple and clear, and written to keep gaming in our state fair and well-regulated.

"Whether by agreement or court order, we intend to bring all sports betting into compliance with the law.”

Michigan restrictions reach another platform

Michigan’s approach combines litigation against exchanges with agreements involving companies that distribute their contracts.

Kalshi faces a state-court preliminary injunction barring it from offering, listing, executing, settling or otherwise facilitating sports-related event contracts for people in Michigan. The order covers products functionally equivalent to moneylines, parlays, totals, in-game wagers and proposition bets.

The order also requires a third-party geolocation provider licensed by the Michigan Gaming Control Board. Potential penalties reach $500,000 per day of noncompliance, though that provision is not the same as a finding that violations occurred or that fines have been imposed.

Robinhood’s restrictions came through a court-approved arrangement. It agreed to stop offering new sports contracts and close remaining Michigan positions by Oct. 9. In exchange, state officials agreed not to pursue enforcement while the company complies.

Coinbase followed with a similar agreement, requiring it to stop offering new sports event contracts and close remaining positions by Oct. 10. The agreement covers contracts traded on Kalshi and other designated contract markets.

Those wind-down requirements should not be assumed to apply to Polymarket. A halt on opening new positions is distinct from an instruction to sell, settle or otherwise close existing trades.

Polymarket’s legal challenge remains separate

Polymarket was already challenging Michigan’s authority before the latest restriction.

In June, U.S. District Judge Paul L. Maloney denied preliminary injunction requests from Polymarket and Robinhood. Both sought to prevent Michigan from enforcing its gambling laws while their federal challenges proceeded.

The companies argued that the Commodity Exchange Act gives the Commodity Futures Trading Commission exclusive authority over their event contracts. Maloney concluded that Congress had not made the clear statement necessary to displace states’ traditional gambling powers.

Michigan’s Coinbase agreement expressly preserves the parties’ legal positions pending further proceedings. The gaming board said Coinbase’s appeal was stayed pending related appeals involving Robinhood, Polymarket and Kalshi.

A change in customer access should therefore not be treated as an admission that Michigan’s legal theory is correct, or as evidence that Polymarket has abandoned its challenge.

Federal appeals courts remain divided

The Michigan restrictions sit within a nationwide dispute over whether sports event contracts belong exclusively under federal derivatives regulation or can also be restricted under state gambling laws.

The Third Circuit Court of Appeals ruled for Kalshi in New Jersey in April. The Ninth Circuit reached the opposite result in Nevada in August. On Sept. 25, the Sixth Circuit, which covers Michigan, Ohio, Kentucky and Tennessee, ruled against Kalshi in the linked Ohio and Tennessee appeals.

The Sixth Circuit affirmed the denial of preliminary protection in Ohio and vacated an injunction that had protected Kalshi in Tennessee. Kalshi requested panel rehearing and rehearing by the full court on Oct. 9.

The ruling creates an unfavorable appellate backdrop for operators challenging Michigan's state enforcement.

Still, other cases remain active elsewhere. Polymarket’s U.S. exchange, QCX, sued Ohio officials Oct. 16, alleging that the state’s licensing requirements discriminate against interstate commerce and are preempted by federal law.

A state-by-state market while Supreme Court petitions wait

The U.S. Supreme Court could eventually provide a national answer, but it has not agreed to do so.

New Jersey is seeking review of the Third Circuit’s pro-Kalshi ruling, while related Nevada petitions offer additional routes for the justices to consider the dispute.

Until then, access depends on individual state actions, court orders and operator decisions, not simply whether a platform holds federal registrations.

Michigan illustrates that distinction. Kalshi is operating under a state-court restriction. Robinhood and Coinbase reached agreements preserving their legal challenges while withdrawing sports products. Polymarket is now stopping new sports positions, further narrowing access without settling who ultimately has authority over the contracts.