Wisconsin warns against electoral betting in prediction markets

The Wisconsin Elections Commission (WEC) warned that residents could lose their right to vote if they participate in betting on elections through prediction platforms. State law explicitly prohibits betting on electoral outcomes under statute 6.03, disqualifying voters involved in such activities.

Legal Consequences for Bettors

The WEC stated that those who bet on platforms like Kalshi and Polymarket could face legal action. Anyone voting without being qualified, after making bets, commits a Class 1 felony. "We want voters to understand that they legally cannot bet and vote in the same election," said Meagan Wolfe, administrator for the WEC. However, Wolfe admitted difficulties in monitoring these bets.

Lawsuits Against Prediction Market Operators

Wisconsin, after legalizing online sports betting with tribal exclusivity, sued operators like Polymarket and Coinbase for offering unauthorized sports betting. The state argues that event contracts are indistinguishable from a regular bet under local law. The Commodity Futures Trading Commission (CFTC) responded with a lawsuit against the state, asserting its exclusive right to regulate these markets.

Additional Developments in the Judicial Sphere

Washington also faced legal challenges with a preliminary injunction against Kalshi, declaring that the platform is for betting, rejecting its defense based on the Commodity Exchange Act. These conflicts highlight the growing tension between state authorities and prediction market operators.

Measures Against Insider Trading

Complementing the lawsuits, Wisconsin Governor Tony Evers signed an executive order in May prohibiting state government employees from profiting in prediction markets using non-public information. This action seeks to prevent the misuse of information obtained through public service.