US sues Wisconsin to block state lawsuits against Kalshi, Polymarket, four other prediction markets
The U.S. federal government has sued Wisconsin to block the state's lawsuits targeting five prediction market platforms: Kalshi, Polymarket, Crypto.com, Robinhood, and Coinbase. Wisconsin Attorney General Josh Kaul had filed three lawsuits alleging the platforms' sports event contracts violate state gambling laws, marking one of the broadest state-level enforcement actions to date against both CFTC-regulated exchanges and offshore operators. The Commodity Futures Trading Commission responded Tuesday with a federal lawsuit arguing that federal commodities law preempts Wisconsin state law and seeking to reaffirm its exclusive jurisdiction over prediction markets. The escalating legal conflict centers on which level of government has authority to regulate event-contract platforms.
Locks Kalshi, Polymarket and three other named platforms into a federal preemption fight that will likely reach the Supreme Court, freezing any state-by-state licensing expansion for at least 12-18 months while courts sort jurisdiction.