In a significant legal move, Wisconsin has initiated lawsuits against major platforms including Kalshi, Robinhood, Coinbase, Polymarket, and Crypto.com. The state accuses these companies of illegally enabling sports betting through their prediction market services, as announced by Wisconsin’s Department of Justice this week.
These online platforms allow users to engage in betting by buying and selling contracts tied to real-world events, ranging from the 2028 U.S. presidential election to the upcoming Superbowl championship.
Attorney General Josh Kaul stated, “These companies have chosen to flout Wisconsin law by thinly disguising the sports betting that they facilitate through what are called event contracts,” during a press briefing on Thursday.
The state’s legal documents compare these platforms to operators of illegal poker games that “take a cut of each pot”. Almost all gambling forms, including sports betting, are prohibited in Wisconsin, except for certain tribal operations. While these companies do not directly take a cut from customer bets, the complaints highlight that they earn “significant revenue” through transaction fees on contract trades.
Kalshi reportedly derives around 90 percent of its revenue from sports contracts, generating more than $1 billion annually, according to the state’s lawsuits.
Kaul emphasized, “No company is above this law, no matter how creatively those companies try to disguise the activity that they’re engaged in.” The state aims for these apps to be labeled as public nuisances and seeks a permanent injunction to halt their sports event contracts.
Platforms like Kalshi, Robinhood, Polymarket, Crypto.com, and Coinbase have allegedly allowed Wisconsin residents to wager on outcomes of events such as the NCAA March Madness Tournament, including the Final Four game, as outlined in the complaints.
The legal documents state, “And for every bet made, these companies collect a fee akin to a casino’s rake at a poker table.” The lawsuit argues that trading event contracts on these platforms is “indistinguishable from an ordinary sports bet.”
Robinhood has defended its practices, with a spokesperson asserting that their event contracts are “federally regulated by the CFTC (Commodity Futures Trading Commission)” and expressing their intention to contest the allegations. Similarly, Kalshi maintains that their platform is a “regulated, nationwide exchange for real-world events,” and thus only under “federal jurisdiction,” differentiating it from “state-regulated sportsbooks and casinos.”
In a related case, the Ho-Chunk Nation filed a lawsuit against Kalshi in August 2025, accusing the company of breaching state, federal, and tribal laws by facilitating sports betting for Wisconsin residents. This case continues, with a trial scheduled for May 2027.
Earlier this month, legislation signed by Gov. Tony Evers legalized sports betting in Wisconsin, but strictly on servers located on tribal lands, with backing from all 11 recognized Native American tribes in the state. However, Coinbase, Polymarket, and Crypto.com have yet to respond to Wisconsin Public Radio’s requests for comment.
