US Regulatory Agency Takes Wisconsin to Court Over Prediction Market Oversight

The US Commodity Futures Trading Commission has added Wisconsin to its list of states being sued for attempting to exert control over prediction markets, which the agency claims falls under its jurisdiction. This move is part of a broader effort by the CFTC, led by Chairman Rostin Behnam, to assert its authority over the trading of event contracts on platforms such as Kalshi and Crypto.com. Several states, including New York, Arizona, and Illinois, have targeted these businesses for allegedly violating state gaming laws. However, the CFTC argues that it has exclusive jurisdiction over these markets, citing its long history of regulating derivatives. Wisconsin recently sued several companies, including Kalshi and Crypto.com, for operating unlicensed gambling operations within the state. In response, the CFTC has filed a lawsuit in the US District Court for the Eastern District of Wisconsin, with Chairman Behnam stating that the agency will take legal action against any state that interferes with federal law regulating financial markets. This development comes on the heels of similar lawsuits filed against New York and other states, with the CFTC seeking to establish its authority over prediction markets.