Civil enforcement action filed against Coinbase by Nevada regulator

The Nevada Gaming Control Board (NGCB) has filed a civil enforcement action against Coinbase Financial Markets in Carson City District Court, having requested an injunction to prohibit the operator from offering unlicensed event contract trading. 

“The Board takes seriously its obligation to operate a thriving gaming industry and to protect Nevada citizens. The action taken yesterday reinforces this obligation,” NGCB Chairman Mike Dreitzer said. 

Within the enforcement action, the NGCB stated Coinbase “serves as an intermediary for customers trading regulated derivatives,” and “offers products referred to as event contracts for sale on its mobile app, which are made available to people in Nevada.”

Under state guidelines such as NRS 463.0193 and 463.01962, the NGCB considers the offering of sporting event contracts, or certain other contracts, to constitute wagering activity. 

“Nevada’s public policy, as expressed by the Legislature, is that the gaming industry is vitally important to the economy of the state and the general welfare of the inhabitants and therefore must be licensed, controlled and assisted to protect the public health, safety, morals, good order and general welfare of the inhabitants of the state,” the complaint said. 

The regulator also considers Coinbase’s operations to be unlawful in Nevada and in violation of NRS 463.160, NRS 463.350, NRS 465.086 and NRS 465.092.

On January 30, the First Judicial State Court of Nevada for Carson City issued a temporary restraining order against Polymarket, claiming an “unlicensed participant…such as Polymarket, obstructs the Board’s ability to fulfill its statutory functions.”

The temporary restraining order will remain in effect for 14 days, as the original case stems from a civil enforcement action filed against Polymarket in Carson City District Court, as well as the prediction market operator’s technology platform Blockratize.