Polymarket Plans to Offer Sports and Election Contracts In the US Market

This comeback follows Polymarket’s 2022 settlement with the Commodity Futures Trading Commission (CFTC), where the firm paid a $1.4 million fine and agreed to block U.S. customers from its platform. Polymarket now moves forward after concluding an FBI investigation without charges.

Strategic Acquisition Paves Regulatory Path

Polymarket secured its return through a strategic acquisition and a favorable regulatory environment. In July, Polymarket acquired QCEX, a CFTC-licensed derivatives exchange, for approximately $112 million. This purchase was key because QCEX is licensed as both a designated contract market and a derivatives clearing organization. Polymarket will offer its prediction markets through this regulated subsidiary.

The regulatory breakthrough was also enabled by a shift in the CFTC’s internal stance. Acting Chair Caroline Pham has vocally supported the industry, labeling prediction markets an “important new frontier” and urging the regulator to “break from past hostility.” Furthermore, Polymarket received a “no-action” letter from the CFTC, which formally authorizes the firm to resume U.S. operations without facing enforcement action over certain reporting and record-keeping rules.

The Contracts: Sports and Election Wagering

Polymarket US recently filed self-certifications with the CFTC, suggesting an imminent launch. These filings, published on the QCEX website, detail the specific event contracts the platform intends to offer, which resemble traditional betting markets:

• Athletic Event Contracts: These cover game winners (Moneylines). If the specified team wins, the long position receives $1.00; if it loses, the long position receives $0.00.
• Athletic Spread Contracts: These contracts focus on Point Spreads.
• Total Score Contracts: These cover point Totals.
• Election Winner Contracts.

The filings are agnostic as to the sport, allowing for a wide range of events. Polymarket US will use data licensed from SportsdataIO to receive official event results, although the firm reserves the right to use other credible news sources. The company plans to enable trading in increments as low as $0.001, which is lower than the typical $0.01 increment.

Political Ties and Ongoing Legal Disputes

Polymarket’s regulatory success came shortly after it secured a strategic investment from 1789 Capital. Donald Trump Jr., a partner at 1789 Capital, subsequently joined Polymarket as a strategic advisor.

This move raises the stakes in the ongoing debate over the nature of prediction markets, with supporters arguing they are a tool for “truth discovery” and critics dismissing them as little more than “digital casinos.”

The platform’s return places it in direct competition with players like Kalshi. However, the legal controversy over offering sports event contracts remains. Various state gaming regulators are currently challenging the legality of these products, maintaining that the contracts are simply illegal sports bets.