NYC Council Investigates Kalshi, Polymarket Over Ads Targeting Minors

New York City’s council has opened an investigation into four prediction market platforms — Polymarket, Kalshi, Coinbase and Gemini Titan — over advertising practices that may have targeted minors, according to Gambling Insider. Council Speaker Julie Menin sent formal letters to the companies on August 11, giving them 14 days to respond to more than 60 questions about their New York operations.

The move opens a new front in New York’s fight with the fast-growing prediction market sector, which already faces a state lawsuit and a parallel legal battle over federal jurisdiction.

Council demands user and revenue data

Menin’s letters seek detailed information dating back to January 1, 2025, including the number of New York users on each platform, customer age and demographic breakdowns, and how much city residents have won or lost trading event contracts. The council also wants specifics on advertising spend, influencer marketing payments and how effective those campaigns have been at attracting younger users, Gambling Insider reported.

In her letter to Polymarket, reviewed by the Wall Street Journal, Menin cited media reports alleging the platform worked with marketing agents and social media influencers to reach young adults — and potentially minors — through misleading promotions.

“Troubling news reports allege that Polymarket conspired with marketing agents and social media influencers to target young adults — and thus potentially minors — with false, deceptive, and unconscionable advertising,” Menin wrote, according to Gambling Insider.

Polymarket and Kalshi said they look forward to engaging with the council, while Coinbase said it “fully complies with applicable laws.” Gemini Titan had not commented at the time of the report.

Legislation and hearings on the table

While the New York City Council cannot lay criminal charges, it can issue subpoenas and compel document production. Menin said the council is weighing legislation that could authorize “increased enforcement, public education campaigns, health measures, and/or the raising or redirecting of public funds” to address prediction markets, and plans to hold public hearings on the industry.

The inquiry is separate from — but runs alongside — a state lawsuit filed by New York Attorney General Letitia James on July 31, which alleges Kalshi is operating an illegal, unlicensed gambling business. Kalshi maintains its event contracts are federally regulated derivatives under the Commodity Exchange Act and argues the Commodity Futures Trading Commission has exclusive jurisdiction, meaning states cannot regulate or ban them.

On the same day the council’s inquiry became public, the CFTC invoked emergency authority ordering Kalshi to keep operating under federal rules despite New York’s attempt to shut it down. Kalshi and the CFTC have separately sued the state in federal court. Unlike those disputes, the council’s investigation centres on consumer protection and advertising rather than the underlying question of whether the contracts amount to gambling.

Why it matters for Canada

Prediction markets remain unregulated in Canada, but their rapid U.S. expansion and the mounting scrutiny of youth-targeted advertising are being watched closely by provincial regulators and licensed operators alike. Ontario’s regulated sportsbooks and casinos, by contrast, must offer responsible-gambling tools such as deposit limits and self-exclusion, and advertising aimed at minors is prohibited under AGCO standards — a contrast that is likely to feature in any future Canadian debate over how prediction markets should be treated.

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