A sports-focused prediction market called Novig processed over $125 million in trading volume during its first week after launching nationwide on August 4. The debut surpassed competitors like Kalshi and Polymarket, though its ongoing legal disputes with five states may determine whether the momentum continues.
Novig’s platform, operated through its Ludlow Exchange LLC subsidiary, received Designated Contract Market status from the Commodity Futures Trading Commission (CFTC) on June 16. The designation allowed it to offer sports prediction contracts across the U.S. under federal commodities law, avoiding state-by-state gambling regulations. The highest single-day volume reached $26.3 million, with baseball and parlays driving most activity.
From State Licenses to Federal Approval
Novig initially operated differently. In 2024, it withdrew from Colorado, where it had functioned as a licensed sportsbook, and adopted a sweepstakes model. That method still involved working around individual state laws. Applying for CFTC approval in January provided another option: a single federal designation to list sports contracts nationwide.
The CFTC granted the status in June, and Novig relaunched as a sports-only prediction market in August. Unlike most rivals, which permit users as young as 18, Novig set its minimum age at 21. The company argues its CFTC-registered status exempts it from state gambling laws, but not all states accept this position.
Five States, Five Lawsuits
Since its launch, Novig has sued New York, Massachusetts, Washington, New Mexico, and Wisconsin to prevent them from enforcing gambling regulations against its platform. The legal approach relies on federal preemption, though early rulings have not favored the company. A federal judge in Wisconsin denied the CFTC’s request for a preliminary injunction on July 28, stating the agency failed to demonstrate a likelihood of success on its preemption claim. In New York, a court declined to issue a temporary restraining order, but a hearing on a preliminary injunction is set for September 11.
Related: Equiti Shifts to Front of Al Wahda Jerseys
For users, the legal uncertainty may seem remote—until a state restricts access. Novig’s contracts cover player injuries, officiating calls, and in-game actions like individual pitches, a category the CFTC has proposed banning. The rule remains under public comment, placing the platform’s business model at risk. If more states follow Wisconsin’s decision, the $125 million opening week could prove temporary rather than the start of a lasting market.
The next court date, along with potential additional state challenges, will determine whether Novig’s federal status holds. Failure could force the company back to negotiating state-by-state permissions, reversing its expansion efforts.
Most users remain unaffected by the legal disputes for now. Trades continue, but the situation may change quickly.
The case highlights broader tensions in regulated crypto markets, where federal approvals clash with state-level restrictions. Similar conflicts have emerged in other financial sectors, where national frameworks meet localized enforcement.