CFTC Sues Wisconsin Over Prediction Markets Jurisdiction

The U.S. Commodity Futures Trading Commission sues Wisconsin, adding the state to its list of legal targets over event-contract jurisdiction, most recently New York.

Wisconsin sued Kalshi, Polymarket, Coinbase, Robinhood and Crypto.com last week, accusing them of running unlicensed gambling operations. The CFTC responds days later in U.S. District Court for the Eastern District of Wisconsin.

CFTC Chairman Mike Selig, the sole member of the agency's five-member commission, leads the pushback against states including New York, Arizona, Illinois and Connecticut. Selig argues the CFTC holds exclusive jurisdiction over event contracts as derivatives.

Selig states he aims to send a message: "If you interfere with the operation of federal law in regulating financial markets, we will sue you."

New York sued Coinbase and Gemini over prediction markets last week, prompting a CFTC lawsuit against the state days later. In Arizona, a court pauses a criminal case against Kalshi, with the judge noting the CFTC is likely to succeed in arguing federal law preempts state gambling laws.