Wisconsin Sues Kalshi, Polymarket, Crypto Firms Over Sports Bets

Wisconsin Attorney General Josh Kaul filed lawsuits in Dane County against Kalshi, Polymarket, Robinhood, Crypto.com and Coinbase, asserting the companies’ sports-related prediction contracts violate state criminal gambling law and constitute public nuisances. The complaints seek court declarations that offering those contracts to Wisconsin residents breaches Wis. Stat. § 945.03(1m) and request injunctive relief to stop the sales.

The filings point to the platforms’ marketing and product descriptions as evidence the contracts operate as bets. Court documents cite a Kalshi Instagram advertisement calling the service “The First Nationwide Legal Sports Betting Platform” and a Polymarket description referring to a “platform where people can bet on the outcome of future events.” The complaint alleges Kalshi generates more than $1 billion annually from sports contracts, about 90% of the company’s estimated revenue.

Kaul’s complaints ask the court to enjoin the firms from offering sports event contracts to Wisconsin residents and to issue declarations under state law. The state frames the offerings as criminal gambling and as public nuisances, and the filings say the products expose consumers, including young people, to unregulated wagering.

The Wisconsin action comes days after New York Attorney General Letitia James filed suit against Coinbase and Gemini over prediction markets. In a statement, James wrote, “Gemini and Coinbase’s so-called prediction markets are just illegal gambling operations, exposing young people to addictive platforms that lack the necessary guardrails,” and her office said it is taking action to stop alleged violations of New York law.

Federal regulators and the Justice Department have pushed back against state regulation of prediction markets. The Department of Justice and the Commodity Futures Trading Commission have sued Connecticut, Arizona and Illinois over state efforts to regulate platforms such as Kalshi and Polymarket, arguing the CFTC has primary federal authority. CFTC Chairman Michael Selig warned that Congress rejected a patchwork state-by-state approach and cautioned that unclear rules could drive operators offshore and increase the risk of large-scale failures.

Legislators have moved as well: two U.S. senators introduced a bipartisan bill last month proposing a federal ban on sports prediction markets. Some states have barred government employees from trading on prediction platforms because of insider-information concerns. Separately, federal prosecutors charged a U.S. Army soldier with allegedly using classified information to trade on Polymarket related to a January operation targeting Venezuelan President Nicolás Maduro.

The Wisconsin complaints target sports contracts specifically; other recent suits have encompassed entertainment and political markets. The filings reviewed did not list court dates or full details of the specific relief sought beyond requests for injunctions and declaratory judgments.