Polymarket Tops $1B Revenue As 20 States Fight It In Court
Prediction market Polymarket has crossed $1 billion in annualized revenue, the company told CNBC exclusively in June, as sports leagues and exchanges pile into partnerships with the platform.
At the same time, twenty states are locked in active litigation arguing that the sports contracts driving that growth are illegal gambling, and a federal appeals court has just sided with them.
Revenue Surge Tied To U.S. Launch
Polymarket's annualized revenue moved "well above $1 billion" six weeks after the company lifted the waitlist on its U.S. exchange, a spokesperson told CNBC.
Daily volume on the U.S. platform climbed from around $50 million in mid-May to more than $200 million by June 20, according to Dune Analytics data cited by CNBC, coinciding with a surge in trading tied to the 2026 FIFA World Cup.
Polymarket's U.S. exchange launched in December 2025 after the Commodity Futures Trading Commission and Department of Justice dropped earlier investigations into the company without charges.
The Ninth Circuit Sides With the States
On August 28, 2026, a three-judge panel of the U.S. Court of Appeals for the Ninth Circuit ruled in KalshiEX, LLC v. Assad that the Commodity Exchange Act does not preempt Nevada's gaming regulations as applied to Kalshi's sports event contracts, affirming a district court decision to dissolve a preliminary injunction Kalshi had sought against the Nevada Gaming Control Board.
The panel, composed of Judges Ryan D. Nelson, Bridget S. Bade and Kenneth K. Lee, held that Kalshi had not shown a likelihood that federal derivatives law strips Nevada of its authority to regulate the contracts as gambling.
The ruling directly conflicts with an earlier Third Circuit decision that favored the platforms in a New Jersey case, setting up a circuit split that legal observers expect the Supreme Court to eventually resolve.
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Twenty States, One Argument
Nevada is one of twenty states now in active litigation with prediction market operators over whether their sports contracts amount to unlicensed sports betting, a fight that began with individual cease-and-desist letters, including one Tennessee sent Polymarket and other platforms in January 2026, and expanded into lawsuits in states including Rhode Island, Massachusetts, Wisconsin, Michigan and New York.
In response, the CFTC has sued several states, including New York and Wisconsin, according to the agency's own press releases, seeking declaratory judgments that federal law gives it exclusive jurisdiction over event contracts and asking courts to block state gambling laws from applying to CFTC-registered platforms.
What To Watch
Polymarket is reportedly seeking a new funding round that would value the company at over $20 billion, a bet by investors that federal oversight will hold steady even as the legal picture darkens for prediction markets in individual states.
With the Ninth Circuit and Third Circuit now in direct conflict, a Supreme Court petition on whether states can regulate these platforms as gambling is widely expected within months.
Until then, licensed US sportsbooks operating under established state gaming law continue to face a competitor whose own regulatory status is still being decided in court.
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