Regulators Greenlight a New Era for U.S. Crypto Prediction Markets

The Commodity Futures Trading Commission (CFTC) has granted Polymarket the green light to operate in the U.S. market following regulatory hurdles that led to the platform restricting access for American users and facing investigations. On Sep. 3, 2025, CEO Shayne Coplan confirmed the approval via X, crediting the CFTC for its swift response. The regulator announced a “no-action position” regarding swap data reporting and recordkeeping for event contracts, effectively allowing Polymarket to operate under the license of QCX, a CFTC-licensed derivatives exchange acquired by the platform for $112 million in July 2024 [1].

The CFTC’s decision marks the culmination of a lengthy legal and regulatory process. In 2022, Polymarket was charged with offering illegal event-based options to U.S. users, leading to a $1.4 million fine and restricted access for American traders. Suspicion of ongoing engagement with U.S. users led to an FBI raid of Coplan’s Manhattan residence in November 2024, during a period of heightened activity around the presidential election [1]. However, in July 2025, the Department of Justice and CFTC concluded their investigations without filing charges, enabling Polymarket to pursue its U.S. relaunch [2].

The approval comes amid a broader regulatory shift under the Trump administration, which has actively supported the expansion of crypto markets. Both the CFTC and the Securities and Exchange Commission (SEC) have recently signaled openness to crypto spot trading on registered platforms, aligning with the administration’s goal of establishing the U.S. as a global crypto hub. This collaborative effort includes the SEC’s “Project Crypto” and the CFTC’s “crypto sprint,” both of which aim to facilitate digital asset trading under existing regulatory frameworks [3]. The CFTC’s no-action stance for Polymarket reflects this broader regulatory flexibility, particularly in the wake of legislative uncertainty at the federal level [3].

Investor confidence has also been bolstered by the regulatory developments. Just a week prior to the CFTC’s approval, 1789 Capital—a venture fund in which Donald Trump Jr. is a partner—announced an investment in Polymarket. The fund delayed the investment until the platform could legally re-enter the U.S., signaling optimism about its potential to recapture market share in the country. Polymarket’s acquisition of QCX is seen as a strategic move to navigate U.S. regulatory requirements while expanding its platform’s capabilities [1].

Polymarket, headquartered in New York City, has been a prominent player in the prediction market space since its launch in 2020. The platform allows users to trade on the outcomes of events ranging from political elections to celebrity news, using cryptocurrency as a medium of exchange. Its return to the U.S. market follows a period of uncertainty and regulatory scrutiny but is now supported by a more accommodating regulatory environment under the current administration. The CFTC’s decision not to enforce recordkeeping and data reporting rules for event contracts simplifies compliance for Polymarket and may serve as a precedent for future crypto-based platforms [4].

The platform’s relaunch is expected to have broader implications for the U.S. crypto market, which has seen increased participation from institutional players and a growing acceptance of digital assets. As regulators continue to refine their approach to crypto trading and prediction markets, Polymarket’s CFTC approval represents a significant step toward normalizing digital asset-based financial products in the country [2].

Source:

[1] Polymarket wins CFTC approval to launch in U.S. (https://finance.yahoo.com/news/polymarket-wins-cftc-approval-launch-200701601.html)

[2] Polymarket set for U.S. launch after getting green light from ... (https://www.cnbc.com/2025/09/03/polymarket-set-for-us-launch-after-getting-green-light-from-cftc-ceo-says.html)

[3] U.S. SEC, CFTC Combine Forces to Clear Registered ... (https://www.coindesk.com/policy/2025/09/02/u-s-sec-cftc-combine-forces-to-clear-registered-firms-trading-of-spot-crypto)

[4] Polymarket Receives Approval to Resume Operations in ... (https://www.coinlive.com/news-flash/897682)