Key facts
- Polymarket has returned to the U.S. market after a four-year absence, operating under a new, regulated structure.
- The company is actively campaigning to convince policymakers, regulators, and the public of its disciplined approach.
- Polymarket U.S. is a CFTC-regulated entity using U.S. dollars, distinct from its international, blockchain-based, crypto-funded platform.
- Key hires include former Coinbase and Department of Justice officials to bolster compliance and enforcement.
- The prediction market industry has seen significant growth, with Polymarket and rival Kalshi trading $26.6 billion in volume.
- The company is investigating its marketing practices following reports of deceptive strategies and undisclosed influencer partnerships.
Polymarket, a prediction market platform, is making a concerted effort to re-establish itself in the U.S. market after a four-year hiatus. The company had previously operated offshore following a settlement with federal regulators over charges of running an unregistered derivatives market. Now, Polymarket is attempting to rebuild trust by emphasizing its new, U.S.-regulated operation, which is distinct from its international, blockchain-based platform.
The U.S. version, Polymarket U.S., operates under the regulation of the CFTC and is funded with traditional U.S. dollars, a departure from its international counterpart which uses cryptocurrency and has faced allegations of insider trading and allowing wagers on sensitive events. To support this transition, Polymarket has hired numerous compliance, surveillance, and regulatory specialists, including former officials from the Department of Justice and FBI, as well as executives from Coinbase and Robinhood.
The company is also employing aggressive marketing tactics, including social media influencers and partnerships with major sports teams and news organizations, to promote its real-time markets as accurate predictors of future events. This campaign aims to position Polymarket U.S. as a more disciplined and trustworthy operation than its previous iteration.
The prediction market industry has seen substantial growth, with combined trading volumes for Polymarket and its rival Kalshi reaching $26.6 billion. The industry also benefits from a generally favorable stance in Washington, with Donald Trump Jr. being an investor in Polymarket. However, Polymarket's re-entry has been met with scrutiny, including reports of deceptive marketing practices and undisclosed influencer partnerships, which the company states it is investigating.
Despite these challenges, Polymarket believes its U.S. operations can gain broader acceptance, even as its international platform continues to generate significant trading volume and occasional controversy, such as concerns over insider trading related to a U.S.-Iran ceasefire announcement.