Is Polymarket legal in Wisconsin?

Wisconsin filed three separate suits on the same Thursday. The Department of Justice's announcement links one complaint against Kalshi, Robinhood, Coinbase and their affiliates, one against "Polymarket and affiliates", and one against Crypto.com and its affiliates, all "filed on Thursday in Dane County". This page follows the second.

Its caption names Blockratize Inc. d/b/a Polymarket, the parent; QCX LLC d/b/a Polymarket US, the CFTC-registered exchange; QC Clearing LLC d/b/a Polymarket Clearing; and twenty unnamed Doe defendants (complaint, p.1). Attorney General Josh Kaul brought it under Wis. Stat. §§ 823.01 and 823.02, which let the attorney general sue to abate a public nuisance (¶14, p.4).

There is one count. The state alleges that each sports-related contract a Wisconsin resident trades is a "bet" under § 945.01(1), that Polymarket commits commercial gambling under § 945.03(1m)(b) and (g) by receiving those bets and using a "wire communication facility" for them "for gain", and that repeated criminal violations "constitute[ ] per se a public nuisance" (¶¶60-70, pp.19-22). Its example is the 2026 NCAA men's tournament: contracts on Michigan beating Arizona in the Final Four traded "for around $0.53" (¶4, p.2). The complaint says Polymarket "apparently does not take the other side" of trades, and rests the "for gain" element on its transaction fees (¶6, pp.2-3).

Wisconsin's definition of a bet excludes "[b]ona fide business transactions which are valid under the law of contracts", and the complaint addresses that exception directly (¶¶30-31, pp.8-9).

These are the state's allegations. No court has ruled on them.

The request is limited to sports-related contracts and to customers located in Wisconsin. The state asks for a declaration that, "by making sports-related event contracts available for trading by customers located in Wisconsin", Polymarket is violating § 945.03(1m)(b) and (g) and causing a public nuisance; for a preliminary and permanent injunction barring Polymarket, its officers, employees and agents "from making sports-related event contracts available for trading by customers located in Wisconsin"; and for other relief the court finds proper (pp.22-23).

Elections, economics and other non-sports markets are not in the request. Nor are damages, penalties or restitution: the relief section asks for none. Nothing has been granted. The state court did not rule before the case was removed, and we have found no injunction from the federal court.

The complaint answers this one directly. Its last footnote says: "The State of Wisconsin does not seek to void or otherwise invalidate outstanding sports-related event contracts where a customer located in Wisconsin is a party; the State seeks only the prospective relief described" (p.23 n.10). That is a statement of what the state is asking for, not a court order, and no order we have found in the case addresses accounts, deposits or withdrawals.

Polymarket's international site has its own rule, which comes from Polymarket and not from Wisconsin: its geographic restrictions page lists the whole United States as close-only, so "Users can close existing positions but cannot open new ones, on both the frontend and the API."

On April 24, QCX LLC removed the case to the U.S. District Court for the Western District of Wisconsin, stating that "All named Defendants consent to this removal" (notice of removal, No. 3:26-cv-00375, ECF No. 1, p.1). It filed before being served (¶57, p.18). The notice describes the suit as "seeking an order shutting down Polymarket US's federally regulated operations in Wisconsin" (¶6, p.4); that is Polymarket US's description, and the complaint's own request is the sports-only injunction above.

It offers two grounds. One is federal officer removal: as a designated contract market, it says, it acts as a "self-regulatory organization" carrying out functions "the CFTC itself would otherwise perform" (¶21, p.8). The other is federal-question jurisdiction, built on the same exclusion the complaint addresses: because a "bet" does not include bona fide business transactions, Polymarket US argues, the state cannot win without addressing whether its contracts are valid swaps under the Commodity Exchange Act (¶48, pp.15-16).

Wisconsin has asked the court to send the case back to Dane County, and as of October 16 we have found no ruling on that request. We have not read the filings after the notice of removal, so whether every Polymarket company named in the complaint is still a defendant is not confirmed. Appeals from Wisconsin's federal courts go to the Seventh Circuit.

None of this is a tax ruling. There is no IRS guidance on event contracts; how prediction market trades are taxed covers the routes people file under, and Polymarket taxes covers the forms.

Kalshi is not a party to the Polymarket complaint. It was sued the same day in the first of the three complaints, together with Robinhood, Coinbase and their affiliates, and the department's announcement describes the same relief for all three suits: a public nuisance declaration and injunctions against sports-related contracts for customers located in Wisconsin. Kalshi's case is a separate action in the same federal court, No. 3:26-cv-00378 (docket). There is no Wisconsin page in our Kalshi legal guide yet; Kalshi's legal status covers the states that have one.