Tennessee's sports betting regulator has demanded Kalshi, Polymarket, and Crypto.com stop offering sports event contracts to residents, threatening to void unsettled trades and issue refunds by Jan. 31. The dispute centers on whether these contracts are federally regulated derivatives or illegal sports wagers under state law, igniting a jurisdictional conflict with Kalshi seeking federal CFTC protection. This case highlights growing regulatory challenges for crypto prediction markets amid conflicting state and federal oversight.