Wisconsin Attorney General Josh Kaul filed lawsuits on April 25 against five major prediction market platforms, claiming they operate illegal sports betting in violation of state law. The companies named are Kalshi, Robinhood, Coinbase, Polymarket, and Crypto.com.
Kaul's office says prediction markets are sports betting under a different label. The platforms let users bet on the outcomes of real events, including sports scores, election results, and economic indicators. In Wisconsin, sports betting is only legal at tribal casinos that have secured the necessary agreements with the state.
"No company is above this law," Kaul said in a statement. "These companies have chosen to flout Wisconsin law by thinly disguising sports betting."
The attorney general says the state is not pursuing financial penalties at this stage. The lawsuits seek court orders declaring the platforms in violation of Wisconsin law and injunctions to block their operations within the state.
Each of the five platforms operates differently, but Wisconsin's position is that they share one defining characteristic: they allow users to bet money on the outcome of sporting events.
Kalshi is a federally regulated exchange that launched sports-related event contracts last year. Polymarket is a crypto-based prediction market that has attracted large trading volumes on sports and political events. Robinhood entered prediction markets through its derivatives platform. Coinbase and Crypto.com added similar products as the sector expanded rapidly over the past 12 months.
Wisconsin's tribal casino operators have held exclusive rights to sports wagering in the state since 2021. The state argues that prediction markets, whatever their structure, undercut that framework.
How the Companies Are Responding
All five platforms rejected Wisconsin's characterization. Each argues that prediction markets are federally regulated financial products rather than gambling.
Kalshi issued a statement asserting it is "a regulated, nationwide exchange subject to exclusive federal jurisdiction." Robinhood said its "event contracts are federally regulated by the CFTC and offered through a registered entity." Coinbase's chief legal officer, Paul Grewal, said Congress had made it clear that "consumers deserve uniform, federal oversight over derivatives markets."
The legal argument from the platforms rests on the Commodity Futures Trading Commission (CFTC) having exclusive jurisdiction over event contracts. That position has not been tested in a Wisconsin court, and no federal court has ruled definitively on whether state gambling laws apply to CFTC-regulated products.
What This Means for Wisconsin Sports Bettors
If Wisconsin's lawsuits succeed, residents will lose access to Kalshi, Polymarket, Robinhood, Coinbase, and Crypto.com for sports-related prediction markets. Court injunctions could come within weeks or take months, depending on how courts handle the jurisdictional arguments.
Users with funds on these platforms should monitor the situation. No funds are at immediate risk from the lawsuits, but an injunction could restrict new deposits and withdrawals within the state.
The Wisconsin case is part of a wider pattern. Multiple states have examined whether prediction markets fall under state gambling law, and the CFTC has been developing new rules for the sector. The outcome in Wisconsin could inform how other states approach the question.
Players in states with licensed online sportsbooks can use those platforms without this uncertainty. Wisconsin bettors looking for legal options can turn to tribal casino sports betting apps that operate under existing state compacts. A full comparison of licensed US sportsbooks is available at Top Online Sportsbooks.
The Wisconsin case follows a pattern similar to other state-level debates over online betting access. Mississippi's experience with mobile betting legislation offers useful context on how these disputes have played out elsewhere.
Sources: FOX6 News Milwaukee, World Casino Directory, Wisconsin Attorney General Josh Kaul's official statements
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