Wisconsin joins the prediction market regulation debate, suing platforms like Kalshi and Polymarket

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BlockBeats news. April 24, according to CoinDesk, prediction market platforms have consistently maintained that their products are financial instruments, not gambling. But Wisconsin does not agree with this view. In a recent lawsuit against Kalshi, Coinbase, Polymarket, Robinhood, and Crypto.com, the state cites these companies’ own marketing materials, calling them unlicensed gambling venues. “Covering up illegal activities with flimsy disguises will not make them legal,” State Attorney General Josh Kaul said in a statement released on Thursday.

At the heart of these lawsuits is actually a simple question: are these contracts financial instruments regulated by the U.S. Commodity Futures Trading Commission (CFTC), or are they gambling activities governed by state gambling laws? The answer will determine whether this fast-growing market is governed by a single set of federal rules, or split across all 50 states, with oversight by local gambling regulators in each jurisdiction. And this dispute will almost certainly ultimately be brought before the Supreme Court for a ruling.

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