DraftKings and FanDuel, the nation’s two largest sportsbook vendors, won’t operate in Nevada anytime soon after state gaming regulators on Wednesday accepted the surrender of FanDuel’s parent company’s licensing plans.

A withdrawal on all pending requests for DraftKings is planned as well.

Nevada Gaming Control Board Chairman Mike Dreitzer, in an industry notice Wednesday, said it is clear that “Flutter Entertainment/FanDuel and DraftKings intend to engage in unlawful activities related to sports event contracts.”

Flutter, FanDuel’s parent company, was on the verge of becoming licensed in the state, but at last week’s board meeting its suitability hearings were removed from the agenda.

Flutter’s abandonment stems from the ongoing legal fight between federally regulated prediction markets and states that offer traditional sports wagering over whether prediction markets can take sports bets.

Prediction markets regularly take yes-or-no propositions on current events and last year moved into taking predictions on the outcome of sports events, which state regulators have interpreted as sports bets.

Wednesday’s regulatory action was triggered by Flutter’s formal announcement of a partnership with Chicago-based CME Group to launch a FanDuel Predicts app next month.

“This conduct is incompatible with their ability to participate in Nevada’s gaming industry,” Dreitzer said in his industry notice.

“The board considers offering sports event contracts to constitute wagering activity under NRS 463.0193 and 463.01962,” Dreitzer said. “Wagering occurs whether the contract is listed on an exchange regulated by the Commodity Futures Trading Commission or elsewhere.”

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