The US Commodity Futures Trading Commission has sued Wisconsin, its fifth lawsuit against a state, to halt state-level legal action against prediction markets. The CFTC argues it has exclusive federal jurisdiction over these platforms, which are regulated as designated contract markets, and is seeking a permanent injunction against Wisconsin’s enforcement.
The US Commodity Futures Trading Commission has filed a lawsuit against the state of Wisconsin. This action is the agency’s latest effort to assert its jurisdiction over prediction markets after the state sued multiple platforms.
The CFTC stated it filed the lawsuit in response to Wisconsin’s suits against Kalshi, Polymarket, Crypto.com, Robinhood, and Coinbase. CFTC Chairman Michael Selig said, “States cannot circumvent the clear directive of Congress.”
This marks the regulator’s fifth lawsuit against a US state aiming to stop such actions. The agency sued New York last Friday and filed against Arizona, Connecticut, and Illinois earlier this month.
Wisconsin sued the five companies last Thursday, arguing their sports-related event contracts constitute illegal betting. State authorities claim these activities require state gaming licenses.
The platforms and the CFTC have consistently rebuffed this assertion. They maintain the contracts are regulated solely under federal law.
The CFTC filed its complaint alongside the Justice Department’s Civil Division in a Wisconsin federal court. The agency contends it has “exclusive jurisdiction” over the event contracts on these federally regulated markets.
“Wisconsin’s attempt to criminalize and shut down federally regulated markets intrudes on the exclusive federal scheme Congress designed to oversee national swaps markets,” the CFTC wrote. It asked the court to rule that state gambling laws do not apply to CFTC-regulated markets.
The agency also seeks a permanent injunction prohibiting Wisconsin from taking action against prediction markets. The complaint names Wisconsin Governor Anthony Evers, Attorney General Josh Kaul, and the state’s Gaming Division.
