U.S. Return of Polymarket Imminent Following $112M Acquisition
In a significant move, Polymarket, the prediction market platform, is making a comeback to the United States after a three-year hiatus. The announcement was made by Polymarket's CEO, Shayne Coplan, who declared, "Polymarket is coming home."
The acquisition of QCEX, an exchange and clearinghouse for prediction markets registered with the Commodity Futures Trading Commission (CFTC), is paving the way for Polymarket's return. The deal, worth $112 million, will provide Polymarket with the necessary infrastructure to operate in the U.S.
However, the legality of prediction markets in all 50 states is not guaranteed. Despite this, Polymarket and its rival, Kalshi, have so far withstood courtroom challenges, and the current CFTC brass is supportive of prediction markets as long as they are under agency oversight.
In a twist of events, Brian Quintenz, a Kalshi board member, is set to be voted on by the Senate Agriculture Committee for full Senate confirmation to lead the CFTC on Monday night. If confirmed, Quintenz has promised to step down from Kalshi's board. Quintenz has been a vocal supporter of the CFTC's role in managing prediction markets.
Polymarket's return to the U.S. market is not without competition. The platform aims to challenge Kalshi for control of the U.S. market. This competition could stir up debates, as critics liken prediction markets to gambling and argue that states are the rightful regulators.
Polymarket has been inching toward a U.S. relaunch since at least last fall. The platform spent about $1 million on Meta advertising to American social media users last fall, despite not having a presence in the U.S. at the time.
Recently, Polymarket has agreed to a partnership with an unnamed entity, and it has been reported that the potential timeline for Polymarket's launch of sports futures in the U.S. is under discussion.
Kalshi, a prediction market platform, has been under scrutiny for marketing itself as a gambling service in the past. However, the company denies being a gambling service. One of Kalshi's board members, who is currently proposed by the Senate Agriculture Committee, supports the oversight of prediction markets.
Polymarket's legal tactics in the U.S. will soon become apparent, with lawsuits involving states being a near certainty. As the battle for the U.S. prediction market marketplace heats up, both Polymarket and Kalshi will need to navigate the complex regulatory landscape to secure their place in the industry.
