Novig sues Wisconsin over crypto sports contracts

Novig sued Wisconsin to stop its sports prediction contracts from being labeled illegal gambling, arguing for CFTC oversight. The case could impact crypto-based prediction markets.

Novig, a sports-focused prediction market platform, has filed a federal lawsuit against Wisconsin's attorney general and state gaming administrator. The company seeks to prevent the state from classifying its sports event contracts as illegal gambling. The core dispute is whether Novig's contracts should be regulated as swaps by the CFTC under federal law or as bets under state gambling laws. This move follows Wisconsin's previous legal actions against platforms like Kalshi, Polymarket, Robinhood, Crypto.com, and Coinbase for allegedly violating state gambling bans. Novig began offering sports contracts to Wisconsin residents just a week before filing the lawsuit, arguing that its contracts fall under exclusive federal jurisdiction. The outcome could have a significant impact on prediction markets, particularly those leveraging crypto infrastructure, as the sector's trading volumes have reached $9.5 billion, much of it tied to crypto platforms. Novig has filed similar lawsuits in other states to defend its business model.