(The Center Square) – Wisconsin Attorney General Josh Kaul filed a series of three lawsuits against prediction markets in Wisconsin alleging that the companies are operating illegal commercial gambling in the state.
The tactic has previously been taken in other states, including Arizona.
The lawsuits targeted Kalshi, Robinhood, Coinbase, Polymarket, Crypto.com and their affiliates for operating what the prediction markets on event contracts in the state that look and payout like sports wagering. Kalshi makes $1 billion annually from the event contracts with sports representing 90% of its revenue, the lawsuit stated.
“Thinly disguising unlawful conduct doesn’t make it lawful,” Kaul said. “These companies’ alleged facilitation of sports betting in Wisconsin should be shut down.”
The lawsuits are part of a national debate on whether states or the federal government should have the final say over prediction markets, which allow people to bet on real-world outcomes such as sports and elections. As states ramp up enforcement against these markets, the Commodity Futures Trading Commission has asserted its exclusive authority, setting up a legal battle that could determine the future of event-based trading nationwide.
The lawsuits come as Wisconsin has approved allowing its 11 tribes to start operating online statewide sports wagering after compacts are created and approved for the revenue and state payments that will be made from the operations.
The Ho-Chunk Nation previously filed a lawsuit filed against Kalshi and Robinhood for operating in the state.
Wisconsin’s tribes agreed to a ban on micro betting on small events such as the result of an individual pitch in a baseball game along with several responsible gaming concessions in order to get the votes necessary to pass the state’s new sports wagering bill.
