Regulators Open Door for Prediction Markets’ U.S. Comeback

Polymarket, the world's largest prediction market platform, has received regulatory clearance from the U.S. Commodity Futures Trading Commission (CFTC) to relaunch its operations in the country after more than three years of absence. The CFTC announced that its Division of Market Oversight and Division of Clearing and Risk had taken a “no-action position” on certain regulatory requirements related to event contracts. This decision effectively allows Polymarket to proceed with its U.S. launch without facing enforcement actions for non-compliance with specific data reporting and recordkeeping obligations. The CFTC’s no-action letter provides a regulatory framework that enables the platform to operate legally within the U.S. market [1].

The CFTC’s decision marks a significant shift in the regulatory environment for prediction markets in the United States. The agency noted that the relief granted is conditional and limited in scope, applying only under specified circumstances and consistent with previous no-action positions for other exchanges and clearinghouses. Acting CFTC Chair Caroline Pham has previously referred to prediction markets as “an important new frontier,” a sentiment that appears to have been reinforced by the recent decision. The CFTC’s willingness to adopt a more flexible stance suggests a broader acceptance of these markets as financial tools, rather than mere speculative mechanisms [2].

Polymarket’s ability to re-enter the U.S. market follows its acquisition of QCX, a CFTC-licensed derivatives exchange and clearinghouse. This strategic move was completed in July 2025 and has provided the legal and operational infrastructure necessary for the platform to function within U.S. jurisdiction. Polymarket’s CEO, Shayne Coplan, praised the CFTC’s work, stating that the approval was achieved in “record timing.” The acquisition of QCX also aligns with the company’s long-term goal of expanding access to its platform in the United States [3].

The regulatory landscape for prediction markets in the U.S. has evolved significantly in recent years. In 2022, Polymarket was forced to exit the market after a regulatory settlement with the CFTC. However, the agency’s recent decision to issue a no-action letter reflects a more accommodating regulatory approach. This shift is partly attributed to the growing interest in prediction markets from both investors and industry experts. Some analysts argue that these markets offer a more accurate forecasting mechanism than traditional polls, while others remain critical of their speculative nature [4].

Polymarket’s return to the U.S. is also supported by a growing ecosystem of prediction market platforms. Competitors such as Kalshi have already secured a strong market presence and high valuations, with Kalshi reportedly reaching a $2 billion valuation in 2025. Polymarket has also attracted significant investment, including a strategic investment from 1789 Capital, a venture capital firm backed by Donald Trump Jr. The investment not only provides financial backing but also signals increased political and financial interest in the potential of prediction markets. Polymarket’s reentry into the U.S. market is expected to intensify competition and potentially expand the overall footprint of these markets in the financial sector [5].

The broader implications of the CFTC’s decision extend beyond Polymarket. The agency’s recent no-action letters and regulatory adjustments suggest that the U.S. is moving toward a more structured and supportive environment for prediction markets. This development could encourage further innovation and investment in the sector, as more firms seek to enter or expand their operations within the U.S. market. At the same time, the regulatory clarity provided by the CFTC may help to address legal uncertainties that have previously hindered the growth of these markets in the United States [6].

Source: [1] Polymarket set for U.S. launch after getting green light from CFTC CEO says (https://www.cnbc.com/2025/09/03/polymarket-set-for-us-launch-after-getting-green-light-from-cftc-ceo-says.html) [2] Polymarket returns to US after CFTC clears regulatory hurdles (https://finance.yahoo.com/news/polymarket-returns-us-cftc-clears-185012793.html) [3] U.S. CFTC Gives Go-Ahead For Polymarket's New Exchange Qcx (https://www.coindesk.com/policy/2025/09/03/u-s-cftc-gives-go-ahead-for-polymarket-s-new-exchange-qcx) [4] Polymarket authorized U.S. return after Donald Trump Jr. investment (https://www.marketwatch.com/story/polymarket-authorized-for-u-s-return-days-after-donald-trump-jr-joins-as-advisor-c3c8b348) [5] Polymarket CEO confirms readiness to launch in US after CFTC approval (https://cryptobriefing.com/polymarket-us-launch-cftc/) [6] Crypto.com bets big on sports prediction markets (https://www.fastcompany.com/91396620/crypto-com-bets-big-on-sports-prediction-markets)