Commentary
Introduction
Madison, Wisconsin — If you love your liberty to vote, you can thank your state Constitution.
Wisconsin law, banter from state agencies and private partisans, all eventually answer to the Wisconsin Constitution when voting liberty is imperiled or chilled.
Thus, the liberty to vote is explicit and affirmative in state constitutions.
State-created voting liberty in the U.S. Constitution does enjoy protection from incursion by force of several amendments and liberties—First Amendment liberties, equal protection, Due Process, race, color, sex, poll tax, age, for example.
Voting and Prediction Market Betting in States
As Wisconsin campaigns continue into the November midterm elections, an odd social-media, anti-voting, anti-betting crusade waged by Wisconsin Elections Commission member Ann Jacobs, and threats made to the public by the Wisconsin Elections Commission (WEC) in June in official communications work to suppress voting liberty.
This voter suppression is accomplished by falsely claiming and warning that betting in prediction markets wagered from any state runs afoul of Wisconsin statute that forbids betting on elections in which a voter casts a ballot within Wisconsin borders.
A July 21 declaration of sorts by the Wisconsin Elections Commission opines legal and regulatory clarity, free of all ambiguity, in asserting that predication-market betting on elections in which a voter also casts his ballot is illegal under Wisconsin's 1849 anti-betting statute; and secondly runs afoul of Wisconsin Statute § 12.13(1)(a) that makes it a Class I felony to intentionally vote in an election without being qualified to vote.
The Wisconsin Elections Commission memo and press release are warnings, purposefully inducing fright into Wisconsin residents, falsely claiming both the state-foundational liberty to cast votes and the liberty not to become felonious slaves of the state, felons, are imperiled by legal conduct outside of Wisconsin, as the Elections Commission claims.
At issue are two Wisconsin statutes, presented and fused together by the Elections Commission.
Wisconsin Statute § 6.03(2) explicitly disqualifies electors from voting "in any election in which the person has made or become interested, directly or indirectly, in any bet or wager depending upon the result of the election."The Wisconsin Elections Commission is not a law enforcement agency, such as the Wisconsin Dept of Justice, and Wisconsin's county district attorneys.
Wisconsin Statute § 12.13(1)(a) makes it a Class I felony to intentionally vote in an election without being qualified to do so.
Problems complicate the Elections Commission novel theory on voting and out-of-state betting, and the legal terrain vis prediction betting and voting that is ambiguous and volatile, the exact opposite of what the Wisconsin Elections Commission claims.
The Wisconsin Attorney General has not issued an opinion on out-of-state betting, likely because horizontal federalism among states is a fundamental tenet and Wisconsin Attorney General Joshua Kaul is looking for some clarity in a critical area in which no clarity exists.
Attorney General has not put forward any guidance regarding the WEC’s statement, though his office has been requested to do so by constituents and the state legislature.
Democratic Party officials can be counted on to take anti-betting political positions, to the point of telling voters what are 'correct' considerations made by voters in their exercise of their franchise.
Wisconsin statutes as with any state law apply to acts committed within Wisconsin jurisdiction, within Wisconsin boundaries.
Acts such as betting that are illegal in one state X, Wisconsin; committed legally within a different state Y, Nevada, have no bearing into state X. The taint of legal activity, legal conduct, in one state does not clash with the laws and sovereign police power of another state in which this conduct is illegal. Update: This is regarded as an unsettled constitutional question by some.
Elections Commissioner member and anti-betting crusader Ann Jacobs has taken a novel position on state jurisdiction, asserting, "What you cannot do is bet there [in other states] and vote here," (X.con).
Jacobs is saying, Wisconsin law follows a Wisconsin voter betting in prediction markets in Las Vegas for example, and then follows a voter back into Wisconsin when a Wisconsin resident casts a vote on the election on which he bets.
Ann Jacobs is substituting her opinions on how and why Wisconsin citizens should exercise their voting state-liberty, asserting citizens ought not vote for their chosen candidates for the 'wrong reasons,' and for 'bad' reasons, (SpectrumNews).
"We don’t allow bribes for the same reason we want people to vote for the right reasons, not the wrong ones," Jacobs said. "If you’re voting because you think you’re going to make money instead of for who should be the best candidate, that’s bad," (SpectrumNews).
Voter is in violation of Wisconsin law for legal conduct in Nevada, Wisconsin Elections Commission claims.
Put another way, Jacobs believes a Wisconsin voter carries a taint of legal conduct back to Wisconsin whereupon it becomes illegal upon exercising a state foundational liberty to cast a vote.
Jacobs and the Wisconsin Elections Commission fail to address basic state co-equal, horizontal sovereign, jurisdictional principles.
Are not Wisconsin voters who are acting legally in other states by betting in prediction markets beyond the reach of Wisconsin law and police power, and contemplated criminal prosecution?
The answer is, yes, and Jacobs and the WEC do not acknowledge that betting in other states is activity beyond Wisconsin's territorial jurisdiction, again under horizontal-state sovereignty, horizontal federalism.
Wisconsin DoJ Seeks Judicial Clarity
The Wisconsin DoJ filed a lawsuit against several prediction markets in April 2026 in state court. (In linked press release, complaints' text is linked at bottom of press release.)
DoJ seeks judicial declaration that "Kalshi, Robinhood, Coinbase, Polymarket, Crypto.com, and their affiliates, to halt their alleged facilitation of illegal sports betting, a form of unlawful commercial gambling, in Wisconsin."
Horizontal state sovereignty is recognized in the Wisconsin DoJ April 2026 lawsuit against several prediction-betting platforms.
Federal Preemption and Prediction Markets
Wisconsin has had an anti-betting statute since 1849, shortly after Wisconsin's1848 inception as a state.
Kalshi and other betting platforms are regulated by the U.S. Commodity Futures Trading Commission (CFTC). Traders enter into binary-event contracts, (yes-or-no prediction contracts on real-world future outcomes).
People betting on Kalshi are traders executing financial derivatives, event contracts, on a federally regulated exchange.
The CFTC argues that under the Commodity Exchange Act (CEA), CEA holds exclusive jurisdiction over event contracts traded on designated contract markets, thereby occupying the field and blocking state gambling enforcement like Wisconsin's.
But to what extent ought this vertical-federalism, federal-state, block clear state prerogatives?
Federal circuit and district courts are deeply divided. Some rulings (such as the Third Circuit in Kalshiex LLC v. Flaherty, No. 25-1922) have backed field preemption for federally regulated event contracts, while other federal judges have denied injunctions and ruled that federal law does not stop states from enforcing anti-gambling statutes.
The certainty with which the Elections Commission represents the law on prediction markets is misleading and under the circumstances, is absurd.
Notes Howard Schweber, UW-Madison Law and Political Science lecturer, (emeritus):
"Polymarket, et al are arguing that they should be immune from the application of all of these laws as well as all other state laws regulating gambling as applied to them, as a matter of federal preemption."
"Federal preemption occurs when there is a conflict between federal and state laws; in that situation the federal law trumps and the state law is invalid. This can happen in a situation of direct conflict (something is legal under state law but illegal under federal law). It can also happen when the federal system of regulation is found to 'occupy the field' (known as 'field preemption') so that any regulation by states would be in conflict with the federal scheme."
UW-Madison's Howard Schweber notes a complex, unresolved legal landscape in an email exchange, posted below:
There are two federal statutes that are potentially involved, [in this controversy of federal regulation conflicting with, and preempting state anti-gambling statues.]Ambiguity in the law should be read in favor of the defendant, a principle that ought guide any contemplated state prosecution of voting bettors, (Rule of Lenity).
The Unlawful Internet Gaming Act (UIEGA) makes it unlawful to engage in 'unlawful Internet gambling,' which means 'to place, receive or otherwise knowingly transmit a bet or wager by any means which involves the use ... of the Internet where such bet or wager is unlawful under any applicable Federal or State law in the State or Tribal lands in which the bet or wager is initiated, received, or otherwise made.' 31 U.S.C. § 5362(10)(A).
Note the 'where the bet or wager is unlawful' language. The statute specifically says that it does not preempt state law: 'the UIEGA at 31 U.S.C. 5362 (10)(D)(2) 'Rule of construction regarding preemption.--Nothing in this subchapter may be construed to preempt any State law prohibiting gambling.'
An explicit disavowal of any preemptive effect of a federal law leaves the states entirely free to enact their own regulations of these markets as a form of gambling, and states have longstanding and well establish authority to define conditions on eligibility for voting. So Wisconsin steps in and says yes, under our gambling laws placing a bet on the outcome of an election is unlawful, and prediction markets' operations fit that description of gambling for state law purposes. And as far as the UIGEA is concerned, Wisconsin is absolutely free to do that.
But there is another federal statute, the Commodity Exchange Act, that regulates futures trading (stock futures, derivatives, etc.) This law says that regulation of those kinds of investments is exclusively the province of an agency called the Commodity Futures Exchange Commission. That law has been held to preempt state regulation of such markets. So no, a state cannot declare that all investments in derivatives are a form of gambling and prosecute everyone involved nor even create restrictions on derivative investments taking place within their state boundaries because the regulation of those investments are preempted by federal law.
How do these two laws interact? The UIGEA explicitly excludes from its coverage any transactions "conducted on or subject to the rules of a registered entity or exempt board of trade under the Commodity Exchange Act” or “any other transaction that is excluded or exempt from regulation under the Commodity Exchange Act.” Id. §§ 5362(1)(E)(i), (iv)(I). So if prediction market bets are actually futures investments rather than wagers—i.e., if they are covered under the CEA rather than UIGEA—then state laws are preempted.
Kalshi and Polymarket are registered with the CFEC based on their self-certification that their business does not involve gambling. In California, a district court judge has ruled that so long as the CFEC accepts their registration, this means that they are not subject to the UIGEA for federal law purposes. (That ruling is currently on appeal to the 9th Circuit; at oral argument the panel of judges apparently expressed skepticism about the judge's ruling.) In April the Third Circuit — without ever mentioning the UIEGA at all — likewise held that prediction market trading falls under the category of futures contracts, so the only relevant federal statute is the Commodities Futures Act.
As I mentioned, that federal law preempts all state regulation per se, including-but-not-limited-to anti-gambling laws. So if these rulings stand up at the Supreme Court then the federal law regulating futures contracts is the one that applies to prediction markets and states may not regulate them.
That would mean that states do not have the authority to regulate those markets because of preemption, including treating participation in prediction markets as a form of gambling.
On the other hand, these are just agency rules and agency certifications. The CFEC would have the authority to rule at any time that these markets are not proper participants in the system of futures trading by a simple administrative ruling, in which case the UIGEA kicks in and so do state laws against gambling. The issues involved here are not constitutional, they are about interpreting statutes and decisions by agencies. Kalshi is trying to argue that they have a right to be classified as futures traders by an administrative agency; it is a sign of how weird our constitutional politics have become that Kalshi et al are essentially gambling — er, "predicting" — that the Executive Branch will always be controlled by a President friendly to their interests who will appoint members to the CFEC who will continue to protect them as a form of futures investment market.
Because if there is ever a Democratic administration in control of the CFEC or a Democratic Congress interested in revisiting the classification of prediction markets under the two federal statutes then Kalshi's case evaporates. Which is what makes their heated rhetoric of 'unconstitutional' and 'crazy' remarkable for its apparent lack of any connection to the legal issues that are being asserted.
32 states have laws against gambling on elections. The prediction markets want to render all of those laws ineffective, a sweeping rejection of state autonomy under the wild theory that a law that prevents states from regulating investments in futures contracts effectively ends states' ability to regulate gambling wholesale. (The Third Circuit noted this possibility in a footnote but declined to address it.)
BUT that's still not the end of the story.
Even if Wisconsin and the other 31 states cannot prosecute or otherwise regulate betting on elections on prediction markets, that does not mean that the states lose their constitutional authority to define the qualifications for voting in federal elections (Article I, section 2 of the US Constitution) including what acts, if shown, would disqualify someone.
A ruling that says otherwise would mean, for example, that states could not decide whether felons or those who commit particular felonies may have their eligibility for voting taken away. I have no idea how that logic is supposed to work.
To summarize, Kalshi et al are making the extraordinary argument that:
IF the Supreme Court accepts that predictions markets are futures markets rather than gambling so that the UIGEA does not apply,
and IF the Supreme Court (following the Third Circuit) says that states are therefore precluded from applying their gambling laws to the placement of bets with prediction markets on the outcome of sporting events,
THEN it will also follow that states are preempted from applying their gambling laws to the placement of bets with prediction markets on the outcome of elections, and
THEN exercising their authority under Article I, section 2 of the Constitution to define the qualifications for voting.
That is a wild theory. It implies that federal statutes can change the federalism provisions of the Constitution, that preemption of criminal laws against gambling means preemption of any regulation having anything to do with gambling (imagine an age restriction, for example), and that 32 states' laws treating betting on elections as a special case have been rendered ineffective because of a federal law about the derivatives market. It was the deregulation of those markets that led directly to the Crash of 2008; why not try it with elections and see what happens?
The Wisconsin DoJ's is seeking a measure of clarity in its lawsuit against several prediction markets filed in April 2026 in state court.
Criminal prosecution referrals and threats made against voting by the Wisconsin Elections Commission's are ill-advised, irrational and false.
Future of Prediction Markets
It's a good bet that the Wisconsin DoJ April 2026 lawsuit seeking clarity prevails in Wisconsin County Circuit court, and eventually at the Democrat-dominated Wisconsin Supreme Court.
It's an equally good bet that federal litigation pursued by the commercial gambling eventually prevails in federal court, and perhaps on First Amendment grounds.
Consider Citizens United v. Federal Election Commission (2010).
Afterall, a 5-4 Court in 2010 held campaign donors are effectively people with First Amendment liberties that prohibit government from restricting campaign and political donations by corporations and unions.
Citizens United v. Federal Election Commission (2010).
Held
(a) Although the First Amendment provides that “Congress shall make no law … abridging the freedom of speech,” §441b’s prohibition on corporate independent expenditures is an outright ban on speech, backed by criminal sanctions. It is a ban notwithstanding the fact that a PAC created by a corporation can still speak, for a PAC is a separate association from the corporation. Because speech is an essential mechanism of democracy—it is the means to hold officials accountable to the people—political speech must prevail against laws that would suppress it by design or inadvertence. Laws burdening such speech are subject to strict scrutiny, which requires the Government to prove that the restriction “furthers a compelling interest and is narrowly tailored to achieve that interest.” WRTL, 551 U. S., at 464. This language provides a sufficient framework for protecting the interests in this case. Premised on mistrust of governmental power, the First Amendment stands against attempts to disfavor certain subjects or viewpoints or to distinguish among different speakers, which may be a means to control content. The Government may also commit a constitutional wrong when by law it identifies certain preferred speakers. There is no basis for the proposition that, in the political speech context, the Government may impose restrictions on certain disfavored speakers. Both history and logic lead to this conclusion. Pp. 20–25.In light of Citizens United v. Federal Election Commission, it would seem bizarre but possible that federal courts would rule states hold power to dictate what are wrong considerations voters take under advisement in exercising their state-created liberty to vote, as courts consider proposition that political speech includes voters' liberty to put their money where their mouth is, without laws burdening free speech.
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