Polymarket left the US following regulatory scrutiny two years ago
Polymarket, a decentralized prediction market platform, is set to return to the US after a more than two-year hiatus. The company recently acquired QCEX, a US-licensed derivatives exchange and clearinghouse, for $112 million.
QCEX, based in Boca Raton, Florida, operates under the oversight of the Commodity Futures Trading Commission (CFTC), making it an ideal partner for Polymarket’s re-entry into the US market. This acquisition paves the way for Polymarket’s comeback, allowing the platform to operate fully within US regulations.
Polymarket allows users to trade on the outcomes of real-world events, such as political elections and sports results, with a trading volume of over $15 billion in the past year, according to Token Terminal. The platform’s founder and CEO, Shayne Coplan, expressed excitement about the company’s return, stating that the acquisition of QCEX would ensure Polymarket operates as a regulated and compliant platform, enabling US users to trade on future events once again.
This move follows Polymarket’s exit from the US in January 2022 after the company settled with the CFTC over allegations of offering unregistered event-based binary options. The settlement involved a $1.4 million fine and a commitment to block US users from accessing the platform. However, recent reports indicate that both the CFTC and the US Department of Justice have dropped their investigations into Polymarket, clearing the path for its return.
Polymarket’s re-entry comes at a time when competition in the prediction market space is heating up. Cryptocurrency exchange Crypto.com launched its own prediction platform in the US in May, and Kalshi, another key player, has partnered with Robinhood to offer prediction market contracts.
Despite facing some resistance from gambling institutions and sports leagues, prediction markets continue to gain traction as a tool for harnessing collective intelligence and forecasting future events.
