The state of Wisconsin has filed lawsuits against several major platforms, including Coinbase and Crypto.com, arguing that their prediction market products amount to illegal gambling.
According to state officials, so-called “event contracts” function like bets, allowing users to wager money on real-world outcomes for potential payouts. The state claims that labelling these products as financial instruments does not change their underlying nature.
The companies involved argue that their offerings are legitimate financial products regulated at the federal level. This disagreement highlights a growing conflict between state authorities and federal regulators over how to classify emerging financial technologies.
Similar legal challenges are emerging across the United States, with different states taking varying positions. Some courts have sided with regulators, while others have been more supportive of the industry.
The issue may ultimately need to be resolved by the Supreme Court, as the outcome will determine how prediction markets are regulated nationwide.
Source: X.com
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