US Regulatory Agency Takes Wisconsin to Court Over Predictive Markets Oversight

The US Commodity Futures Trading Commission has added Wisconsin to its list of defendants in a series of lawsuits aimed at establishing the agency's jurisdiction over predictive markets. This move comes as several states, including New York, have attempted to regulate or shut down companies like Kalshi and Crypto.com, citing violations of state gaming laws. However, CFTC Chairman Mike Selig has spearheaded a counter-effort, arguing that his agency has exclusive authority over these markets, which he believes are a form of derivatives trading. Wisconsin recently sued several companies, including Kalshi and Crypto.com, for operating unlicensed gambling operations, prompting the CFTC to respond with a lawsuit of its own. Selig stated that the agency will take action against any state that interferes with federal law in regulating financial markets. The CFTC's actions have been seen as a clear assertion of its authority, with Coinbase's vice president of legal, Ryan VanGrack, noting that the era of jurisdictional ambiguity is over. The agency's lawsuit against Wisconsin is the latest in a series of legal battles, including a case against New York and a paused criminal prosecution in Arizona, where a court has suggested that federal law may preempt state gambling laws.