Wisconsin election officials have issued a warning that individuals who participate in prediction markets, such as Kalshi, by betting on election outcomes may be barred from voting in those elections. This stance is based on a state statute enacted in 1849, shortly after Wisconsin achieved statehood.
The Wisconsin Elections Commission stated that any person who has made or become indirectly or directly interested in a bet or wager on an election's result is prohibited from voting in that election. According to Meagan Wolfe, administrator of the commission, voters who intentionally cast a ballot after betting on an election outcome could face felony charges for voting illegally.
While many states have laws prohibiting gambling on elections, Wisconsin is reportedly the first to explicitly state that participation in prediction markets disqualifies individuals from voting. New York has similar provisions in its constitution and state law, with officials indicating that voting in an election where a bet has been placed is prohibited. The New York attorney general's office is currently involved in litigation concerning the regulation of prediction markets like Kalshi under state gambling laws.
The resurgence of attention on these old laws comes amid the rapid growth of prediction markets, which have seen increased advertising and sponsorship deals. Companies like Kalshi have reacted strongly, with Benjamin Freeman of Kalshi calling the Wisconsin interpretation "insane" and "unconstitutional." Kalshi, in a statement, described the situation as "incredibly dangerous to democracy."
Ann Jacobs, a member of the Wisconsin Elections Commission, noted that the law has been in place for a long time and suggested that those unhappy with it should contact their legislators. The historical context for such laws dates back to the 19th century, when election gambling was common and concerns arose about potential election rigging. A 2012 paper by economic historians Paul Rhode and Koleman Strumpf highlighted that election betting was particularly intense during the Jacksonian era and that allegations of voting fraud linked to election bets surfaced after the 1844 election.
In March, Wisconsin's prediction market law gained renewed attention after Jacobs posted on social media about the prohibition. The commission's legal staff concluded that participation in prediction markets constitutes making a bet or wager on an election outcome, thereby disqualifying voters.
Enforcement of this law presents practical challenges. Election lawyers suggest that challenging a voter would require an observer to be present at the time of voting or when an absentee ballot is processed. The risk of felony prosecution also exists if law enforcement obtains information about individuals voting in elections they have wagered on, though some legal experts believe such enforcement fears are likely overstated.
Questions also exist regarding the law's legal standing. While Wisconsin's original state constitution permitted the disenfranchisement of election bettors, that specific provision was repealed 40 years ago. Some legal scholars argue that the current constitution only authorizes disenfranchisement based on felony convictions or incompetency, potentially making other grounds impermissible. Challengers could also argue that the law is not narrowly tailored enough to justify depriving citizens of their voting rights.
Despite these legal complexities, Wisconsin officials maintain that the law is in effect. The policy behind such laws, as stated by Jacobs, is to ensure that voting decisions are based on a candidate's qualifications rather than potential financial gain for the voter.
In New York, similar constitutional and state law provisions exist. If New York adopts an interpretation consistent with Wisconsin's, participants in election prediction markets could also be barred from voting. The New York attorney general's office has characterized prediction markets as "gambling platforms."