CFTC Expands Lawsuit Campaign to Defend Authority Over Prediction Markets

The U.S. state of Wisconsin has become the latest to be sued by the Commodity Futures Trading Commission in its ongoing effort to establish its authority over prediction markets operated by firms like Kalshi and Crypto.com. Several states have taken legal action against these companies, alleging violations of state gaming laws due to betting activities on their platforms. However, CFTC Chairman Mike Selig has been leading a legal counterattack, arguing that the agency has exclusive jurisdiction over event contracts, which he considers a form of derivatives activity that falls under the CFTC's purview. Recently, Wisconsin filed a lawsuit against Kalshi, Coinbase, Polymarket, Robinhood, and Crypto.com, accusing them of operating unlicensed gambling operations within the state. This move echoes similar claims made by other states against the industry. In response, Selig has filed a lawsuit in the U.S. District Court for the Eastern District of Wisconsin, stating that his intention is to send a clear message: "If you interfere with federal law regulating financial markets, we will take legal action against you." Earlier, New York sued Coinbase and Gemini over their prediction markets businesses, prompting the CFTC to file its own lawsuit against the state. According to Ryan VanGrack, Coinbase's vice president of legal and head of global litigation, "The CFTC's lawsuits, including those in New York and Wisconsin, draw a clear line in the sand. By taking action to block state overreach, the commission has sent a strong signal that the era of jurisdictional uncertainty is over." Arizona has been pursuing a criminal case against Kalshi, but a court recently paused the prosecution, suggesting that federal law is likely to preempt state gambling laws. Read More: U.S. CFTC adds New York to string of states it's suing to stop prediction market pushback UPDATE (April 29 2026, 14:26 UTC): Adds Coinbase comment.