Key Points
- Polymarket is negotiating with the CFTC to remove restrictions on U.S. traders implemented following a 2022 settlement
- The platform settled regulatory violations in 2022 by paying $1.4 million and relocating its primary operations overseas
- The company purchased QCX LLC for approximately $112 million in 2025 to establish a compliant U.S.-based platform
- Intercontinental Exchange committed up to $2 billion in investment, placing Polymarket’s valuation near $8 billion
- Regulatory clearance would position Polymarket as a direct rival to Kalshi in the American marketplace
Polymarket has entered into ongoing negotiations with the Commodity Futures Trading Commission aimed at reversing the prohibition that has prevented U.S. residents from accessing its flagship prediction marketplace since 2022.
According to Bloomberg reports based on sources with knowledge of the situation, Polymarket is working to restore direct access for American participants to its offshore, blockchain-powered trading platform.
The restriction originated from regulatory enforcement proceedings in 2022. The CFTC brought charges against Polymarket, operating at the time under the name Blockratize Inc., for providing unregistered event-based contracts to U.S. participants without securing necessary regulatory permissions. The matter concluded with a $1.4 million civil monetary penalty and a commitment to exclude American traders from the service.
Prediction markets enable participants to purchase and sell contracts linked to outcomes of future events including political elections, sporting competitions, and economic indicators. These platforms have generated increased attention alongside heightened regulatory examination from state authorities who contend they function as unregulated betting operations.
Following the 2022 resolution, Polymarket continued pursuing American market entry. In July 2025, the organization completed its purchase of QCX LLC, a CFTC-registered derivatives marketplace and clearinghouse, in a transaction valued at approximately $112 million.
QCX underwent rebranding as Polymarket US. This acquisition provided American participants with a regulatory-compliant pathway to the platform via authorized brokerage firms. The CFTC released a modified order in late 2025 permitting restricted access for U.S.-based users.
Domestic Operations Lag Behind International Platform
Polymarket introduced a U.S.-focused version concentrating on sporting events and selected categories. However, transaction volumes on this domestic platform have significantly underperformed compared to the activity and market depth found on the primary offshore operation.
This performance disparity seems to be motivating the present effort to fully merge the offshore marketplace with the U.S.-registered QCX authorizations, potentially operating under a unified regulatory structure.
Polymarket has secured substantial institutional investment. Intercontinental Exchange, which owns the New York Stock Exchange, committed a strategic investment reaching up to $2 billion in the company. This investment establishes Polymarket’s valuation at approximately $8 billion. The platform has additionally formed a data collaboration agreement with Dow Jones.
Formal regulatory authorization would necessitate approval from CFTC commissioners through a vote. The commission presently operates with just one active commissioner, Chair Michael Selig, while multiple positions remain unfilled. This situation might expedite the approval timeline, although certain legislators have expressed apprehension about significant decisions proceeding with such limited commissioner representation.
Selig has previously maintained that state governments lack authority over prediction market oversight, asserting that jurisdiction resides with the CFTC.
Recent Insider Trading Investigation Complicates Negotiations
These regulatory discussions unfold against the backdrop of a recent insider trading investigation involving the platform. A member of the U.S. military faced accusations of circumventing access restrictions using VPN technology to trade on Polymarket’s international platform, reportedly generating profits exceeding $400,000 through transactions informed by classified government information.
The CFTC has additionally initiated legal action against New York and Illinois regarding state-level efforts to regulate prediction markets, maintaining federal jurisdictional authority.
Should authorization be granted, a fully functional U.S. exchange would establish Polymarket as a direct competitor to Kalshi, which currently operates as the CFTC-regulated event contract marketplace serving United States customers.
Representatives from both Polymarket and the CFTC declined to provide statements regarding the ongoing negotiations.
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