The Wisconsin Department of Justice filed a complaint in Dane County Court against Robinhood, Kalshi, Coinbase, Polymarket and Crypto.com, arguing their sports-related “event contracts” constitute illegal gambling under Wis. Stat. 945.03(1m). The state is seeking both preliminary and permanent injunctions to block these platforms from offering such contracts to Wisconsin residents.

This lawsuit follows a New York Attorney General action against Coinbase and Gemini, as well as ongoing federal enforcement by the CFTC against state-level regulation of prediction markets. A bipartisan bill was recently introduced in Congress to ban sports prediction markets, signaling growing legislative and enforcement pressure nationwide.

If the injunctions are granted, Robinhood could be forced to suspend its sports contract offerings in Wisconsin, potentially reducing revenue from its prediction market segment. The lawsuit also raises reputational and compliance risks, as Robinhood navigates overlapping state and federal regulatory frameworks.