The Commodity Futures Trading Commission (CFTC) has filed a lawsuit against the State of Wisconsin, challenging its enforcement actions against federally regulated prediction markets. The CFTC argues that event contracts are federally regulated swaps, not subject to state gambling laws. This legal action seeks a permanent injunction to prevent Wisconsin from interfering with federal jurisdiction over derivatives markets. The lawsuit follows Wisconsin's recent cases against platforms like Kalshi and Coinbase, where the state applied gambling laws to event-based contracts. CFTC Chairman Mike Selig emphasized that states cannot override federal authority, highlighting similar disputes in New York, Arizona, and other states. The core issue is the classification of event contracts, with the CFTC asserting they are swaps under federal law, while Wisconsin views them as gambling instruments. This case is part of a broader legal battle between federal and state authorities over prediction market regulation.