Michigan Regulator Confirms Coinbase Pausing Sports Markets

Coinbase has given up its fight to offer sports contracts in the Wolverine State…for now.

The Michigan Gaming Control Board has announced a deal with the best prediction markets to temporarily drop sports markets in the state. The offering will go offline by 12 AM on October 10, and the operator will settle any outstanding contracts. 

As a result of the deal, Coinbase will avoid fines and other legal action from the regulator. It will run until the legal battle between the two sides is resolved.

Back in August, the operator filed for a preliminary injunction to prevent regulatory action. However, the Sixth Circuit Court of Appeals rejected the request. That same court recently ruled that Ohio and Tennessee can enforce gambling regulations on sports prediction markets, incentivizing Coinbase to seek a deal.

The MGCB hailed the deal as a win in its fight to protect Michigan’s online sports betting market.

“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 shared in a press release. “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.”

SCOTUS Not Ready to Review Cases

The US Supreme Court recently released its docket for the upcoming session, but it did not include lawsuits over sports prediction markets. While disappointing, SCOTUS received its first request for review only a few weeks ago, so this was no surprise.’

Until the nation’s highest court issues a ruling, rulings from the US Circuit Courts will determine the issue. While the Third Circuit has ruled in favor of federal regulation for sports markets, the Ninth and Sixth sided with state regulators. That means control over the industry will vary across regions of the US.

As a result, more platforms could seek deals like the one Coinbase struck to avoid hefty fines and the possibility of criminal charges. However, with the issue not even on the SCOTUS docket, it's unclear how long these deals will last.