---
type: source
title: "CFTC Sues Wisconsin — Fifth State in 26-Day Campaign, Same-Day Response to Enforcement"
author: "CoinDesk Policy / The Hill / Courthouse News"
url: https://www.coindesk.com/policy/2026/04/28/cftc-sues-wisconsin-in-agency-s-legal-campaign-defending-prediction-markets-authority
date: 2026-04-28
domain: internet-finance
secondary_domains: []
format: news-article
status: processed
processed_by: rio
processed_date: 2026-04-29
priority: high
tags: [prediction-markets, cftc, wisconsin, preemption, tribal-gaming, kalshi, regulatory-campaign]
intake_tier: research-task
extraction_model: "anthropic/claude-sonnet-4.5"
---

## Content

The CFTC filed its fifth state lawsuit today (April 28, 2026) against Wisconsin and key state officials, defending Kalshi and Polymarket against the April 23-24 Wisconsin AG enforcement campaign targeting platforms earning over $1B annually from sports contracts.

**The 5-state campaign timeline (26 days):**
- April 2: AZ, CT, IL (simultaneous, 3 states)
- April 10: Arizona TRO granted (first federal TRO win)
- April 24: New York (SDNY, case 1:26-cv-03404)
- April 28: Wisconsin (TODAY — same day as first news cycle)

**Wisconsin case background:** Wisconsin AG Josh Kaul filed 3 lawsuits on April 23-24 targeting Kalshi, Polymarket, Robinhood, Coinbase, and Crypto.com under Wis. Stat. 945.03(1m), a Class I felony (illegal sports betting). The filing comes weeks after Gov. Tony Evers signed a law legalizing online sports betting ONLY through tribal compacts.

**Oneida Nation's role — CORRECTED:** The Oneida Nation issued a statement of support for the Wisconsin AG lawsuit, citing IGRA-protected tribal gaming exclusivity concerns. The Oneida Nation is NOT a formal co-plaintiff in the Wisconsin AG lawsuit. Previous session notes incorrectly described them as a "co-plaintiff constituency" — they are a supportive stakeholder. The tribal gaming IGRA angle is real and motivates the state's enforcement, but tribal operators are not parties in the state litigation.

**Federal preemption argument (CFTC):** Congress gave CFTC exclusive jurisdiction over derivatives traded on registered exchanges to prevent state-by-state regulatory patchwork. Wisconsin's suits do what Congress prohibited. CFTC asks for declaratory judgment that Wisconsin's actions violate the Supremacy Clause.

**Response timing:** CFTC filed TODAY within hours of first news cycle coverage of the Wisconsin lawsuit. This suggests CFTC is operating a standing legal response process — any state enforcement action triggers an immediate federal counter-filing. The response time has accelerated from the April 2 filings (which responded to actions from October-March) to same-day response.

**Scope confirmation:** Wisconsin suit targets centralized commercial platforms (Kalshi, Polymarket, Robinhood, Coinbase, Crypto.com). No mention of decentralized governance protocols, on-chain futarchy markets, or unregistered protocols. Pattern holds across all 5 state enforcement actions: enforcement zone = centralized commercial platforms + sports/election event contracts.

## Agent Notes

**Why this matters:** The CFTC's same-day response timing signals that the federal enforcement machinery is now institutionalized. Any state filing triggers an immediate counter-filing. This creates a ratchet effect — every state enforcement action amplifies the federal preemption campaign while also amplifying state resistance. The regulatory battle is accelerating in both directions simultaneously.

**What surprised me:** The same-day response time. Previous suits had days-to-weeks between state enforcement and CFTC counter-filing. Same-day response suggests CFTC had the Wisconsin lawsuit draft ready and was waiting to file. This implies coordination between CFTC and the regulated platforms (Kalshi/Polymarket) to monitor state filings in real time.

**What I expected but didn't find:** A TRO sought in the Wisconsin federal case. In Arizona, CFTC filed April 2 and won TRO April 10 (8 days). In Wisconsin, the AG is pursuing civil enforcement (unlike Arizona's criminal charges). The threshold for TRO may be higher for civil enforcement cases. Watch for whether CFTC seeks TRO in Wisconsin.

**KB connections:**
- [[futarchy-based fundraising creates regulatory separation because there are no beneficial owners and investment decisions emerge from market forces not centralized control]] — 5-state CFTC campaign confirms MetaDAO's structural irrelevance to enforcement targets
- Pattern 9 from research journal: "Federal preemption confirmed, decentralized governance exposed" — now confirmed by 5 federal suits + 1 TRO, all explicitly scoped to DCMs

**Extraction hints:**
1. "CFTC's 5-state litigation campaign (April 2-28, 2026) has established a pattern: every state enforcement action against DCM-registered prediction market platforms triggers an immediate federal preemption counter-filing, accelerating toward a SCOTUS resolution of the CEA vs. state gambling law conflict" [confidence: likely]
2. "No state enforcement action across 7+ state lawsuits has named decentralized governance protocols, on-chain futarchy markets, or unregistered on-chain prediction market infrastructure — the enforcement zone is precisely bounded to centralized commercial platforms with sports/election event contracts" [confidence: likely]

**Context:** Wisconsin sports betting context is notable — Evers signed a law LEGALIZING sports betting just weeks ago, but only through tribal compacts. Prediction markets that effectively offer sports betting without tribal compacts are therefore undercutting BOTH the newly legalized tribal sports betting market AND the state's newly passed regulatory framework. The tribal gaming economic stake creates unusually strong political motivation for enforcement.

## Curator Notes
PRIMARY CONNECTION: [[futarchy-based fundraising creates regulatory separation because there are no beneficial owners and investment decisions emerge from market forces not centralized control]]
WHY ARCHIVED: Fifth state in CFTC's 26-day campaign; confirms enforcement scope pattern (DCMs only, never on-chain protocols); documents same-day response timing as institutional indicator
EXTRACTION HINT: Extract two claims: (1) CFTC's same-day counter-filing as signal of institutional enforcement machinery; (2) Enforcement scope pattern confirmation (7+ state actions, zero decentralized protocol citations) as evidence the regulatory boundary is structurally stable, not contingent.
