Crypto.com and Novig Challenge Missouri's Sports Wagering Laws in Federal Court

Crypto.com and Novig have initiated legal action against the state of Missouri, contesting the classification of their sports event contracts as unlicensed gambling. The lawsuits were filed on October 16, 2026, in response to cease-and-desist letters issued by Missouri Attorney General Catherine Hanaway.

The letters, sent between September 16 and 17, demanded that the companies either cease operations for Missouri residents or obtain the necessary state licenses and pay associated fees. Missouri's sports betting regulations, established after the approval of Amendment 2 in November 2024, require a 10% tax on adjusted gross revenue from licensed sports betting, with application fees reaching up to $500,000.

Crypto.com and Novig argue that their sports event contracts should be classified as swaps, a type of financial derivative regulated by the Commodity Futures Trading Commission (CFTC). They contend that federal law should take precedence over state gambling regulations. In contrast, Missouri maintains that these contracts constitute unlicensed sports betting under state law.

The lawsuits are proceeding in different federal courts, with Novig's case filed in the Eastern District of Missouri and Crypto.com's in the Western District. The outcome of these cases could have significant implications for the burgeoning sports betting market in Missouri, which only recently established its legal framework.

As the legal battle unfolds, the platforms face challenges due to precedents where federal courts have previously rejected similar claims regarding federal preemption in unlicensed sports betting disputes. Observers will be watching for early motions in both cases and any potential relief that might pause Missouri's enforcement actions.