Polymarket appears poised to legally offer prediction markets in the US following a favourable regulatory development.
The Commodity Futures Trading Commission’s (CFTC) Division of Market Oversight and Division of Clearing and Risk has issued a no-action letter regarding swap data reporting and recordkeeping rules for certain event contracts.
Polymarket CEO Shayne Coplan also celebrated the approval on X.
The decision came in response to a request from QCX LLC and QC Clearing LLC, part of CFTC-licensed derivatives exchange and clearinghouse QCEX. The move comes shortly after Polymarket announced its $112m acquisition of QCEX in July.
The purchase gives Polymarket a regulatory foundation to operate prediction markets under US law, addressing a long-standing barrier for the company.
The no-action position means the CFTC will not pursue enforcement against QCX, QC Clearing, or participants for failing to meet certain swap-related reporting and record-keeping obligations, provided the activity falls within the scope of the letter.
The CFTC noted that the relief is narrowly tailored and mirrors treatment granted to other designated contract markets and clearinghouses.
Interest in prediction markets has surged throughout 2025, with Kalshi recently raising $185m at a $2bn valuation, and Polymarket securing backing from Donald Trump Jr.-linked 1789 Capital.
Meanwhile, in light of what appears to be a changing attitude toward prediction markets, Kalshi is also preparing to expand its offerings.
It has announced, via a CFTC request, the launch of multi-outcome event contracts, comparable to parlay bets used in conventional sports wagering.
Internal CFTC dissent over regulatory approach emerges
While the CFTC has taken a pragmatic stance, internal critics have voiced sharp concerns about the agency’s handling of prediction markets.
Commissioner Kristin N. Johnson, who is departing the regulator, issued a pointed critique of the Commission’s failure to establish clearer rules.
She said her disappointment stemmed from the inability to finalise a framework for political event contracts, warning that recent activity highlighted systemic risks.
Johnson stressed that prediction markets often target retail participants and may eventually introduce leveraged or margined products without adequate oversight.
She argued that this creates a conundrum for the Commission, which must balance innovation with the need for investor protections.
Johnson’s remarks also touched on political betting, a particularly contentious area.
She asserted: “A bi-partisan group of members of Congress indicated that they agreed with that the CFTC should not be required to police election contacts and expressed concerns about betting on the outcome of democratic elections.”
Johnson called for the use of the formal rulemaking process, including public comment periods, to create effective regulation.
She underscored that a lack of guardrails and transparency leaves the market exposed to risks that could exacerbate broader concerns around integrity and consumer protection.