A federal judge denied the CFTC’s request to block Wisconsin from enforcing state gambling laws against sports prediction markets. The court ruled that CFTC registration does not shield platforms like Kalshi from state regulations. Wisconsin can continue its lawsuit against Kalshi, Polymarket, Crypto.com, Robinhood, and Coinbase over unlicensed sports event contracts.
On July 29, 2026, United States District Court Judge William Griesbach refused the U.S. Commodity Futures Trading Commission’s (CFTC) motion for a preliminary injunction against Wisconsin. The judge decided that mere registration with the CFTC cannot exempt prediction companies from state gambling laws during the litigation period.
Kalshi and Crypto.com joined the list of companies that could not become part of the lawsuit. The case considers whether there is a conflict between Wisconsin’s gambling laws and federal laws.
According to Judge Griesbach, the Commodity Exchange Act does not explicitly prohibit Wisconsin from enforcing its gambling laws. The court noted that Wisconsin officials believe sports-related event contracts are sports bets, subject to state gaming regulation.
Judge Griesbach further ruled that CFTC had not demonstrated irreparable harm that would happen immediately. This decision comes after the state filed a case against Kalshi, Polymarket, Crypto.com, Robinhood, and Coinbase back in April for lacking necessary gambling licenses.
Due to the recent CFTC loss, Wisconsin can pursue its lawsuit. The latest ruling is part of an emerging legal issue regarding prediction market regulation in the US.
Earlier, the U.S. Court of Appeals for the Third Circuit ruled in favor of Kalshi that federal regulation can be more stringent than state regulations. Attorney Daniel Wallach stated that state courts could rule in favor of a preliminary injunction stopping prediction sites.
Kalshi and the CFTC will likely take their case to the U.S. Court of Appeals for the Seventh Circuit. This could prove crucial to determine ultimate jurisdiction over the growing prediction market industry.
