New York sues Coinbase and Gemini; Robinhood also retreats on contagion fears

Published: 2026-04-22 01:20:08 ET COIN

Coinbase and Gemini shares posted sharp declines on Tuesday following a lawsuit by the New York Attorney General targeting their prediction markets, while Robinhood also pulled back in their wake.

Kevin Smith

Published on 04/22/2026 at 01:20 am EDT

Platforms exposed to prediction markets retreated on Wall Street on Tuesday after New York State Attorney General Letitia James filed lawsuits against Coinbase Financial Markets and Gemini Titan. Coinbase led the decline, while Robinhood also fell, due to a contagion effect, despite not being directly named in the proceedings. This reaction stems from fears of a broader regulatory crackdown on an activity that several players had touted as a new growth driver.In complaints filed in Manhattan, Letitia James accuses Coinbase Financial Markets and Gemini Titan of operating prediction markets without a license from the New York State Gaming Commission. According to the Attorney General, these "event contracts," tied to outcomes such as sports or elections, constitute illegal gambling under state law. She also alleges that the firms allowed users aged 18 to 20 to access these markets, whereas the minimum age for mobile sports betting in New York is set at 21. The Attorney General is seeking the disgorgement of allegedly illegal profits, civil penalties of up to three times those amounts, and corrective measures, particularly regarding access for those under 21 and marketing on college campuses.This offensive comes as the jurisdictional battle between states and the CFTC has intensified in recent weeks. The federal regulator asserts its exclusive authority over commodity derivatives markets, including certain prediction markets, while New York maintains that a portion of these products actually falls under the definition of gambling.