Wisconsin joins the prediction market regulation debate, suing platforms like Kalshi and Polymarket

Golden Finance reports that on April 24th, the prediction market platform has consistently maintained the stance that their products are financial instruments, not gambling. But Wisconsin does not agree with this statement. In a recent lawsuit against Kalshi, Coinbase, Polymarket, Robinhood, and Crypto.com, the state cites the companies’ own marketing content, calling them unlicensed gambling establishments. “Covering illegal activities with weak disguises does not make them legal,” State Attorney General Josh Kaul said in a statement released on Thursday.
The core issue behind these lawsuits is actually quite simple: are these contracts regulated financial instruments overseen by the U.S. Commodity Futures Trading Commission (CFTC), or are they gambling activities subject to state gambling laws? The answer will determine whether this rapidly growing market is regulated by unified federal rules or divided among the 50 states, each managed by local gambling regulators. And this dispute will almost certainly be ultimately brought before the Supreme Court for a ruling.