The US state of Connecticut has hit Robinhood, Kalshi and Crypto.com with cease and desist orders, alleging that the platform is holding unlicensed sports betting through event contracts.

Connecticut Department of Consumer Protection Sent The letters to the three platforms on Wednesday, claiming they are “gambling online without a license, especially with a sports beat,” are available online along with event contracts.

“None of these entities are licensed to offer wagering in our state, and even if their contracts violate numerous other state laws and policies, including offering wagers to persons under the age of 21,” DCP Commissioner Brian Caffarelli said.

DCP Gaming director Chris Gelman accused the platforms of “fraudulently advertising that their services are legitimate,” adding that they operate outside the state’s regulatory environment, “posing a serious risk to consumers who may not realize that wagers placed on these illegal platforms offer no protection for their money or information.”

Prediction markets have come under legal scrutiny in several US states, as the use of these platforms has skyrocketed this year and attracted billions of dollars in investment to allow users to bet on the outcome of various events.

Kalshi returned to the court

A Kalshi spokesperson told Cointelegraph that it is “a regular, nationwide exchange for real-world events, and is subject to exclusive federal jurisdiction.”

“This is very different from state-regulated sportsbooks and casinos to our customers. We are confident in our legal arguments and have filed a lawsuit in federal court,” Kalshi added.

In a complaint filed In Wednesday’s suit against DCP, Kalshi claims that “Connecticut’s attempt to regulate Kalshi on the federal regulatory framework that Congress established to regulate derivatives on designated exchanges.”

It added that its platform is subject to the “exclusive jurisdiction” of the Commodity Futures Trading Commission and that its sports program contracts are “lawful under federal law.”

Crypto.com and Robin Hood did not immediately respond to requests for comment.

In its statement, Connecticut’s DCP said that prediction market platforms pose a serious risk to users because they lack required technical standards and security protections for financial and personal data.

The agency claimed that such platforms also lack integrity controls to prevent insider betting or manipulation, operate without formal oversight of their payout rules, advertise to self-excluded gamblers and on college campuses, and allow betting on events with known outcomes, thereby giving unfair advantages to insiders.

Related: Polymarket opens its waiting list for users after CFTC green light

Only three platforms are legally licensed for sports acquisition in Connecticut: DraftKings, FanDial and Fanatic, all of which require users to be at least 21 years old.

At least 10 U.S. states were hit by wildfires

Connecticut isn’t the only state to take a tough stance on predictive platforms. Regulators in two neighboring states have already taken action.

New York sent a cease and desist letter to Kalshi in late October, and the company responded by suing the state on October 27. Meanwhile, the Massachusetts state attorney general sued Kulshi in state court in September.