US Regulator Takes Wisconsin to Court Over Prediction Markets Dispute

The US Commodity Futures Trading Commission has expanded its legal campaign to assert its authority over prediction markets, with Wisconsin becoming the latest state to be sued. This move is part of a broader effort by the agency to defend its jurisdiction over trading platforms such as Kalshi and Crypto.com. Several states, including New York, Arizona, Illinois, and Connecticut, have attempted to crack down on these businesses, alleging violations of state gaming laws. However, CFTC Chairman Mike Selig has led a pushback, arguing that the agency has exclusive jurisdiction over event contracts, which he considers a form of derivatives activity. Wisconsin recently sued several companies, including Kalshi, Coinbase, and Crypto.com, for operating unlicensed gambling operations, prompting the CFTC to respond with a lawsuit. The agency's chairman emphasized that interfering with federal law in regulating financial markets would result in legal action. The CFTC's actions have been seen as a clear signal that it will not tolerate state encroachment on its authority, marking the end of jurisdictional ambiguity in this area.