Wisconsin Becomes Latest State Seeking to Rein In Prediction Markets

As with other states’ actions against the markets, the Wisconsin lawsuits specifically target sports-related wagering, which comprises the bulk of the platforms’ revenue. The state claims Kalshi earns more than $1 billion per year from sports wagers, for instance, representing nearly 90% of its total revenue.

According to Decrypt, the Wisconsin actions closely mirror the lawsuit filed days earlier by New York Attorney General Letitia James against Coinbase and Gemini over similar prediction market activity.
“Gemini and Coinbase’s so-called prediction markets are just illegal gambling operations, exposing young people to addictive platforms that lack the necessary guardrails,” James said in a statement, adding, “My office is taking action to protect New Yorkers and stop these platforms from violating the law.”

The New York and Wisconsin actions come as tensions are already high between state agencies and the Commodity Futures Trading Commission (CFTC) regarding oversight of the markets. In early April, the CFTC and the Department of Justice sued Arizona, Illinois and Connecticut over the states’ efforts to rein in platforms the federal agency regards as futures markets under its exclusive jurisdiction.

“The CFTC will continue to safeguard its exclusive regulatory authority over these markets and defend market participants against overzealous state regulators,” the agency’s chairman, Michael Selig, said in a statement. “This is not the first time states have tried to impose inconsistent and contrary obligations on market participants, but Congress specifically rejected such a fragmented patchwork of state regulations because it resulted in poorer consumer protection and increased risk of fraud and manipulation.”

Read more: CFTC Sues New York Over Authority in Prediction Market Regulation

Shortly after those lawsuits were filed, the federal Third Circuit Court of Appeals ruled in favor of the CFTC in a separate case against New Jersey over the state’s targeting of Kalshi over sports-related wagering. A 2-1 majority held that the state cannot enforce its sports-betting laws against the platform because the trades in question qualify as “swaps” under federal law. Writing for the majority, Judge David Porter concluded that the Commodity Exchange Act (CEA) grants the CFTC “exclusive jurisdiction” over swaps traded on federally registered exchanges such as Kalshi, preempting state laws that would otherwise regulate the same activity.

The clash has also caught the attention of Congress. In March, Sens. Adam Schiff (D-CA) and John Curtis (R-UT) introduced a bill to prohibit entities regulated by the CFTC, including prediction markets, from listing contracts related to sporting events.

“The CFTC is greenlighting these markets and even promoting their growth,” Sen. Adam Schiff said in a statement. “It’s time for Congress to step in and eliminate this backdoor, which violates state consumer protections, intrudes upon tribal sovereignty and offers no public revenue.”

 The bill also seeks to prohibit “casino-style games” from being listed on the platforms, such as slot machine games, video poker, blackjack and bingo. “Too many young people in Utah are getting exposed to addictive sports betting and casino-style gaming contracts that belong under state control, not under federal regulators,” Curtis said in a statement.

Although prediction markets have been around for several years they have recently exploded in popularity. Transaction volume reached $63.5 billion in 2025, according to Next.io and is projected to reach $1.3 trillion by 2030.