Wisconsin sues Kalshi, Polymarket, Coinbase, and others over alleged illegal sports betting
The Wisconsin Department of Justice filed lawsuits against Kalshi, Robinhood, Polymarket, Coinbase, and Crypto.com over their sports betting and event contract offerings, according to filings published May 29. The state argues these platforms' prediction markets constitute illegal gambling under Wisconsin law. The action comes as prediction market regulation reaches the White House and former President Donald Trump backs CFTC authority over the sector. Separate filings flagged Arizona's enforcement posture toward the same five firms — KalshiEx, Polymarket, Crypto.com, Robinhood, and Coinbase — for potential emergency relief. The platforms, which also include Gemini, maintain their products should be classified as financial derivatives rather than gambling.
Any Wisconsin state-court ruling that classifies these contracts as gambling arms regulators in Ohio, Pennsylvania, and Minnesota with binding precedent to force geofencing. The CFTC's simultaneous federal suit against Wisconsin gives Kalshi institutional backing it lacked when it sued Ohio alone last October.
Wisconsin joins Rhode Island and Minnesota in active state litigation against prediction market platforms, making it the third state-level front where Kalshi's federal preemption defense faces simultaneous testing alongside the CFTC's parallel federal suits.