Is Polymarket Legal in New York?

How is Polymarket Legal in New York?

Since it has a federal license from the CFTC, Polymarket is legally allowed to operate in every state, including New York. The state’s lawsuit claims that Polymarket is an illegal and unlicensed gambling platform. However, Polymarket is officially considered a contract market, not a sports betting site. Also, federal commodities laws override New York State’s laws, allowing Polymarket to remain legal.

Why Does New York Have No Legal Online Sports Betting?

New York is one of many states that offers legal online sports betting. The state launched mobile betting in January 2022, allowing legal sports wagers for anyone physically present in the state. New York’s online sports betting is regulated by the state’s Gaming Commission, which has issued licenses to nine different online sportsbooks. But since Polymarket doesn’t consider itself a sports betting platform, it’s not among the licensed sportsbooks.

Why Has New York Sued Polymarket?

New York is suing Polymarket, alleging that event contracts traded on the site are actually bets. If New York were to be successful in this argument, it would mean that trading contracts on events is the same as sports betting. Therefore, Polymarket wouldn’t be among the legally licensed sportsbooks, meaning it has been operating illegally without paying taxes or other fees.

Is Polymarket Safe to Use in New York?

At the moment, Polymarket is safe to use in New York. The state’s lawsuit adds a complicating factor, but as long as Polymarket is federally regulated, Polymarket is a legitimate and safe platform. Also, Polymarket does a great job of using encryption software and blockchain technology to protect all of the personal and financial data stored on the site. This makes it safe to share personal information. Just keep in mind that responsible risk management is essential when trading contracts with Polymarket and similar sites.

Want to know more? Read our complete Polymarket review.

What Happens to My Open Positions if New York Bans Polymarket?

With a pending lawsuit, it’s possible that New York will get its wish to ban Polymarket at some point. If that happens, trades on Polymarket will no longer be allowed by anyone who is physically in the state of New York. However, some of the details would depend on the court’s official ruling.

If Polymarket were to shut down in New York, there would likely be a forced liquidation of all open contracts. This means that unresolved contracts would either be refunded in full or settled immediately based on the current market value. According to its lawsuit, New York is also hoping to return past proceeds made by Polymarket to New York users who originally purchased those contracts.

How Polymarket Works: Event Contracts Explained

Polymarket’s event contracts are based on real-world events that have either a “yes or no” outcome. For example, a sporting event may have a “yes or no” outcome regarding whether a specific team wins or not. The same can be applied to a politician on whether he wins or loses an election or whether or not a hurricane makes landfall on a specific day. If you are new to this concept, our prediction market learning guides offer a great starting point to understand how these contracts work.

Event contracts at Polymarket have a price between 1¢ and 99¢. The price is based on the market’s perception of the event and the probability of that event coming ot fruition. This means that the prices of contracts fluctuate based on the trades of other people. Contracts that are closer to 99¢ have a higher probability and a lower payout, whereas contracts closer to 1¢ are less likely to occur, meaning they come with a higher payout.

If a contract has a price of 80¢, it has an implied probability of 80%. At the conclusion of that event, a losing contract settles for $0, while a winning contract settles for $1. For a winning contract, the profit is the difference between $1 and the price of the contract. Therefore, a contract purchased for 80¢ will have a profit of 20¢. Of course, Polymarket users typically purchase multiple contracts for the same event to increase their potential earnings.

Polymarket vs. Sports Betting: What’s Actually Different

While many people view Polymarket and sportsbooks as the same, there are several key differences that we’ve outlined in the table below:

What Can You Trade in New York?

Polymarket has several types of trade markets available, most notably event contracts in sports, politics, crypto, weather, tech, culture, and economics.

The sporting markets include leagues from all over the world in over a dozen different sports. There are contracts for individual games, championships, awards, and player performances.

When it comes to best political betting, contracts are based primarily on election results, both domestic and global, as well as important geopolitical events.

Polymarket offers contracts for the future price of cryptocurrencies like Bitcoin, including the price on a given day and when certain thresholds will be met.

There are weather markets at Polymarket that typically relate to the high and low temperatures in specific cities.

For tech contracts, the events are primarily centered around tech CEOs, new products, and the activity of prominent companies.

There is a wide range of markets related to pop culture, including popular movies, award winners, and events on reality TV shows.

For the economic market on Polymarket, most of the markets relate to financial metrics, the CEOs of prominent companies, and key financial events.

How to Sign Up for Polymarket in New York

To sign up for Polymarket in New York, there are only a few simple steps to follow: 

1. Use the Polymarket website or download the Polymarket mobile app.

2. Click the “Sign up” or “registration” buttons and fill out the personal details needed to create a new account.

3. Input WSN when prompted for a Polymarket promo code.

4. Fill out the information to verify your identification to create a Polymarket account.

5. Deposit at least $10 to fund your account, and the $50 trading bonus will be added to your account balance. 

Claim Polymarket Promo Code

Polymarket vs. Other Prediction Markets in New York

Polymarket isn’t the only platform gaining popularity in New York and elsewhere. With several alternatives available, choosing the best prediction market for your needs comes down to comparing their unique features and sign-up offers. If you want to maximize your initial value, be sure to claim a top prediction market bonus before you start trading. The table below shows the similarities and differences among the top platforms.

Responsible Risk Management

No matter what platform you choose for event contract trades, it’s essential to practice responsible risk management. Trading always risks capital, and so trades shouldn’t be made on a whim. It’s important to research the probability of an event and understand the payout before completing a trade, so you don’t risk more than you can afford to lose. Polymarket can assist by allowing users to place self-imposed guardrails on how much they can deposit and trade, which can be a big step in practicing responsible risk management. At WSN, we are committed to promoting safe trading practices at Polymarket and similar platforms.