Key Points
- Discussions underway between Polymarket and the CFTC could reverse the platform’s 2022 US prohibition
- Polymarket’s existing American beta version restricts users to sports betting markets with extensive waitlist delays
- With four commissioner positions unfilled, CFTC Chairman Michael Selig holds singular authority over approval decisions
- Federal prosecutors recently indicted a military service member for generating over $400,000 through classified information trades on Polymarket
- Competitor Kalshi, operating within regulatory compliance from inception, achieved a $22 billion market valuation
The world’s most prominent prediction market service, Polymarket, is actively pursuing regulatory approval to resume full operations for American customers. Company representatives are engaging in ongoing negotiations with the Commodity Futures Trading Commission regarding the removal of access barriers implemented in early 2022.
Bloomberg initially disclosed these regulatory discussions. This development follows an extended period during which Polymarket maintained international operations while cultivating a substantial worldwide customer base.
Shayne Coplan established Polymarket in June 2020. The service enables participants to purchase outcome shares predicting whether specific future events will materialize, utilizing blockchain infrastructure operating on the Polygon network.
Regulatory scrutiny from the CFTC began in late 2021. Investigators determined that Polymarket had functioned as an unregistered venue for event-based binary options contracts from its inception. By January 2022, authorities imposed a $1.4 million financial sanction and prohibited all transactions involving US-based participants.
Current Status of American Operations
Polymarket attempted market re-entry through a $112 million acquisition of QCEX, a CFTC-registered derivatives platform, completed in July 2025. The company subsequently introduced a beta iteration of Polymarket US toward the end of 2025.
This preliminary offering remains significantly constrained. Sports-related markets constitute the sole available category, with access controlled through a waitlist containing hundreds of thousands of prospective users.
The platform’s most sought-after market segments—political forecasting and macroeconomic events—remain unavailable to American users. While Polymarket has announced intentions to introduce climate, cryptocurrency, and electoral markets, no implementation schedule has been established.
Conversely, domestic competitor Kalshi launched under full regulatory compliance. The company has established partnerships with major financial platforms Robinhood and Coinbase, achieving a $22 billion valuation by March.
Polymarket is pursuing a $15 billion valuation target. Monthly trading volume surpassed $3 billion globally by October 2025.
Intercontinental Exchange, which owns the New York Stock Exchange, pledged capital commitments reaching $2 billion while assigning Polymarket an $8 billion valuation during the same period.
Regulatory Authority Concentrated in Single Official
Modifying Polymarket’s regulatory standing requires an official commission vote. However, current vacancies affecting four of five CFTC commissioner positions leave Chairman Michael Selig as the primary decision authority.
Selig has demonstrated receptiveness to offshore platform integration. During April 16 testimony before the House Agriculture Committee, he expressed the agency’s objective to restore offshore market liquidity to domestic markets through appropriate regulatory frameworks.
Proposed solutions include integrating the international platform’s blockchain technology with the licensed domestic exchange or executing complete consolidation onto the US-authorized infrastructure. Both pathways necessitate substantial operational restructuring.
Opposition exists within Congress. A coalition of Democratic House members submitted correspondence to Selig recently advocating for strengthened enforcement measures against offshore prediction platforms. Their concerns emphasized insider trading vulnerabilities and national security implications.
Recent events substantiated these apprehensions. Law enforcement officials charged a US Army service member last week for exploiting classified military intelligence to generate profits exceeding $400,000 through wagers on Venezuelan President Nicolás Maduro’s potential capture. The individual circumvented platform restrictions using VPN technology.
This incident demonstrated the ease with which American users bypass access prohibitions while highlighting oversight deficiencies.
Polymarket has processed hundreds of millions in trading volume connected to military conflicts in Ukraine, Israel, and Iran. Comprehensive US regulation would impose stringent limitations on numerous such contracts. CFTC regulations explicitly forbid US-registered platforms from offering contracts related to warfare, terrorism, or political assassinations.
Prediction markets have attracted significant political interest. Donald Trump Jr. maintains advisory positions with both Polymarket and Kalshi. Trump Media and Technology Group has signaled intentions to establish a competing prediction market service.
The CFTC maintains its assertion of federal jurisdiction over prediction markets through ongoing litigation, while multiple state governments contend these products fall under state gambling regulatory authority.
