The company has “technically banned” Americans from using its platform since it reached a settlement with the CFTC in 2022, and its U.S.-based alternative has not fully launched, according to the report.
Some U.S. traders have found ways to get around the prohibition, the report said, pointing to the U.S. soldier who was accused last week by the CFTC and the Justice Department of using classified information to participate on Polymarket’s international exchange.
The company’s U.S.-based alternative, Polymarket US, is federally regulated but is not crypto-native, is still in beta mode, and has seen little trading, per the report.
Reached by PYMNTS, Polymarket declined to comment on the report.
Polymarket said in November that it received an approval from the CFTC that positioned the company to return to the U.S. under a fully regulated exchange structure.
Advertisement: Scroll to Continue
The CFTC issued an Amended Order of Designation that permits Polymarket to operate an intermediated trading platform subject to the requirements applicable to federally regulated U.S. exchanges, the company said.
“This approval allows us to operate in a way that reflects the maturity and transparency that the U.S. regulatory framework demands,” Polymarket Founder and CEO Shayne Coplan said at the time in a press release. “We’re grateful for the constructive engagement with the CFTC and look forward to continuing to demonstrate leadership as a regulated U.S. exchange.”
PYMNTS reported two months earlier, in September, that when the CFTC issued a no-action letter regarding event contracts, in response to a request from two businesses owned by Polymarket, it in essence gave Polymarket a regulatory green light to re-enter the American market.
Polymarket’s return to the American market marked a turnaround from 2022, when the company was subjected to a CFTC settlement and a $1.4 million fine for operating as an unregistered derivatives facility.
The CFTC said in March that it was seeking public comment on whether it should amend or issue new regulations governing event contracts traded on prediction markets.
