Key Highlights
- The prediction market platform is negotiating with the CFTC to reverse restrictions on U.S. users implemented following a 2022 enforcement action
- Polymarket settled regulatory charges in 2022 with a $1.4 million fine and relocated its primary operations overseas
- The firm purchased QCX LLC for approximately $112 million in 2025 to establish a compliant U.S. marketplace
- Intercontinental Exchange poured up to $2 billion into the company, pushing its valuation to approximately $8 billion
- Regulatory clearance would position the platform as a major competitor to Kalshi in the American prediction market space
Polymarket has entered into ongoing negotiations with the Commodity Futures Trading Commission regarding the removal of restrictions that have prevented American traders from accessing its flagship prediction marketplace since 2022.
According to a Bloomberg report citing sources with knowledge of the discussions, the company is working to restore direct access for U.S. customers to its primary offshore, blockchain-powered trading platform.
The restrictions originated from regulatory enforcement measures taken in 2022. The CFTC brought charges against Polymarket, operating at the time as Blockratize Inc., for providing unregistered event-based contracts to American customers without securing necessary regulatory clearances. The matter concluded with a settlement requiring a $1.4 million civil monetary penalty and a commitment to exclude U.S. traders from the service.
Prediction markets enable participants to purchase and sell contracts linked to outcomes of future occurrences, including political contests, sporting events, and financial indicators. These platforms have gained significant traction while simultaneously drawing regulatory examination from state authorities claiming they function as unregulated wagering operations.
Following the 2022 settlement agreement, Polymarket continued pursuing strategies to re-establish its American presence. In July 2025, the organization completed the acquisition of QCX LLC, a CFTC-registered derivatives trading facility and clearinghouse, in a transaction valued at approximately $112 million.
QCX underwent rebranding as Polymarket US, providing American participants with a regulatory-compliant pathway to the platform via authorized brokerage firms. The CFTC published a modified order in late 2025 permitting restricted U.S. user participation.
Domestic Operations Lag Behind International Platform
The company initiated a soft launch of its U.S.-focused platform, concentrating on athletic events and selected markets. However, activity levels on this domestic version have fallen significantly short of the volume and depth seen on its international exchange.
This performance disparity seems to be motivating the company’s current efforts to merge its offshore operations with the U.S.-licensed QCX infrastructure, potentially creating a unified regulatory structure.
The platform has secured substantial institutional capital. Intercontinental Exchange, which owns the New York Stock Exchange, committed a strategic investment reaching $2 billion in the company, establishing an estimated valuation around $8 billion. Additionally, Polymarket has formed a data collaboration agreement with Dow Jones.
Formal regulatory approval would necessitate a vote by CFTC commissioners. Presently, the commission has just one active commissioner, Chair Michael Selig, with multiple positions unfilled. This situation might streamline the approval timeline, although certain legislators have expressed unease about major decisions proceeding with such limited commissioner participation.
Selig has publicly maintained that state governments lack jurisdiction over prediction markets, asserting that oversight belongs exclusively to the CFTC.
Recent Insider Trading Incident Complicates Negotiations
These regulatory discussions are occurring against the backdrop of a recent insider trading prosecution involving the platform. Federal authorities charged a U.S. military servicemember with utilizing a VPN to circumvent geographic restrictions and access Polymarket’s international platform, allegedly generating more than $400,000 in profits from trades informed by classified government intelligence.
The CFTC has additionally initiated legal proceedings against New York and Illinois over those states’ efforts to impose regulations on prediction market operations, defending federal regulatory supremacy.
Should approval be granted, a fully licensed U.S. exchange would establish Polymarket as a direct rival to Kalshi, which currently operates the only CFTC-regulated event contract platform available to American traders.
Both Polymarket and the CFTC declined to provide statements regarding the ongoing discussions.
