CFTC Sues Wisconsin Over State's Legal Action Against Prediction Markets

The Commodity Futures Trading Commission (CFTC) has filed a lawsuit against the state of Wisconsin. This federal action is a direct response to Wisconsin's own civil suits against five CFTC-regulated prediction market platforms: Kalshi, Polymarket, Crypto.com, Robinhood, and Coinbase. Wisconsin had accused the companies of felony violations of state law less than a week ago.

The CFTC's move against Wisconsin follows a similar pattern, occurring just days after the Commission sued New York following that state's legal challenge against prediction markets. CFTC Chairman Michael S. Selig stated, "States cannot circumvent the clear directive of Congress. Our message to Wisconsin is the same as to New York, Arizona, and others: if you interfere with the operation of federal law in regulating financial markets, we will sue you."

This litigation is part of a broader regulatory clash. In a related case, a federal court in Arizona recently issued a temporary restraining order, blocking a state criminal prosecution against a CFTC-regulated company following a CFTC lawsuit. The Commission has also filed lawsuits against Connecticut and Illinois, in addition to New York, and has submitted amicus briefs in appellate courts.