AG Josh Kaul announced the state is suing a group of prediction markets, alleging they’ve facilitated illegal sports betting in Wisconsin. 

The trio of lawsuits filed yesterday in Dane County court against Kalshi, Robinhood, Coinbase, Polymarket, Crypto.com and their affiliates seeks to stop their use of “event contracts” allowing Wisconsin users to bet on the outcome of sporting events. Kaul at a press conference said the contracts are “indistinguishable legally or practically” from sports betting. 

Sports betting and commercial gambling is illegal in Wisconsin, with limited exceptions. 

“Our position in this case is that event contracts are no different than ordinary sports bets. The companies collect a fee, we allege, for every bet that’s made, leading them to earn significant revenue from Wisconsinites through violations of our state’s gambling regulations,” Kaul said. 

Kalshi, for example, generated about $1.3 billion in annual revenue from sports contracts alone, Kaul said, though he did not have Wisconsin-specific figures. 

A spokesperson for Kalshi said the state doesn’t have jurisdiction over its services. 

“As other courts have recognized, Kalshi is a regulated, nationwide exchange for real-world events, and it is subject to exclusive federal jurisdiction,” the spokesperson said. “It’s very different from what state-regulated sportsbooks and casinos offer their customers. We are confident in our legal arguments.”

Gov. Tony Evers earlier this month signed into law a bill paving the way for online gaming in the state as long as servers are located on tribal lands. The next step will be for the guv to negotiate new compacts with the state’s 11 tribes, the only entities allowed to offer gaming.

Kaul said there is no direct relationship between the lawsuits and the new law. He said the allegations would be the same whether or not that legislation had passed. 

Kaul noted there has been a “huge increase” in online sports betting in recent years. 

“I certainly think that that may very well be linked to the fact there was legislative activity on this topic recently, just as there has been litigation activity,” he said. 

Wisconsin tribes considering measures to curb online gaming abuse

GOP state Rep. Ron Tusler said the Forest County Potawatomi assured him steps would be taken to curb abuses of online gaming before he supported legislation opening the door to tribes offering the option.

That includes banning the use of credit cards and microbetting, wagers on small events such as whether the next pitch in a baseball game is a strike.  

The Assembly signed off on the bill in February. Tusler said in a phone interview he released yesterday’s statement detailing the assurances he received from the Forest County Potawatomi as a reminder as tribes work on new compacts with Dem Gov. Tony Evers to allow online gaming. 

Tusler said the Potawatomi gave him the impression during a meeting before the Assembly vote that other tribes would follow the restrictions as well.

“Now that I’m out of the equation, I wanted to get this out because I’m hoping that they keep these agreements,” Tusler said in a phone interview.

A Forest County Potawatomi spokesperson said the tribe has always “taken measures to promote responsible gaming with their guests and that will be no different as we move to mobile sports betting.

“The Potawatomi will include these important consumer limitations and other initiatives to promote responsible gaming when mobile sports betting is underway in Wisconsin,” the spokesperson said.

In yesterday’s release, Tusler said the Potawatomi agreed to:

  • An age verification process to prevent minors from placing bets.
  • A system that allows users to limit how much they can bet in a day.
  • A system that allows users to pause or lock their accounts.