CFTC sues Wisconsin: Defending the "exclusive jurisdiction" of prediction markets, countering state government bans

The U.S. Commodity Futures Trading Commission (CFTC) filed a lawsuit against Wisconsin on Tuesday, accusing the governor, attorney general, and state officials of attempting to use state laws to crack down on prediction market platforms.

Recently, Wisconsin has sued platforms such as Coinbase, Robinhood, Crypto.com, Polymarket, and Kalshi, claiming that their sports event contracts constitute "public nuisance." The CFTC strongly asserts exclusive jurisdiction over prediction markets (event contracts), arguing that the state government's attempt to criminalize federally regulated markets infringes upon the national swap market regulatory framework designed by Congress, and is seeking a court order to declare that Wisconsin's ban is superseded by federal law on CFTC-regulated platforms.