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CFTC sues Wisconsin for blocking prediction market activities
Crypto World News reports that the U.S. Commodity Futures Trading Commission (CFTC) has filed a lawsuit against Wisconsin, escalating its legal action to prevent the state from taking action against federally regulated prediction market platforms. According to the CFTC’s statement, this lawsuit directly responds to recent complaints from Wisconsin against Kalshi, Polymarket, Crypto.com, Robinhood, and Coinbase, all of which operate under federal regulation. CFTC Chairman Michael Selig stated, “States cannot circumvent clear instructions from Congress.” He added that similar warnings have been issued to New York, Arizona, and other states. The CFTC’s lawsuit requests the court to rule that the state’s gambling laws do not apply to platforms regulated by the CFTC and to issue a permanent injunction preventing Wisconsin from pursuing enforcement actions. Wisconsin’s legal action targets contracts related to real-world outcomes, including sporting events. State Attorney General Josh Kaul said that users betting on event outcomes and receiving fixed returns fit the state’s definition of gambling. The CFTC’s complaint reiterates that such contracts are considered swaps under federal commodity law, a position supported in previous lawsuits.