Polymarket is exploring a path to bring its main exchange back to the United States, according to reporting from Bloomberg.
The company’s announcement last year that it would re-enter the U.S. market after acquiring derivatives exchange QCEX, a platform regulated by the Commodity Futures Trading Commission. QCX LLC, which does business as Polymarket US, operates a more limited version of the company's global platform.
Over the years, Polymarket has been marked with scrutiny by the derivatives regulator.
In 2022, Polymarket settled with the CFTC for allegedly offering illicit binary options contracts. In return, it agreed to pay a $1.4 million fine, wind down its non-compliant markets, and take preventative steps to block U.S. users on an ongoing basis.
Later, the agency and the Justice Department dropped their investigation into Polymarket last year.
Now, over the past few weeks, Polymarket had discussed lifting that ban on U.S. customers with CFTC officials, which would require a formal commission vote, Bloomberg reported, citing people familiar.
Vacant spots at the CFTC have raised eyebrows among some lawmakers. The CFTC can have up to five commissioners, including the chair, with no more than three being of the same political party. Currently, CFTC Chair Michael Selig is the sole commissioner, sparking concern over how much influence he may have.
Predictions markets have been front and center at the CFTC as Selig pursues rulemaking and has embarked on a legal battle against a number of states. He has asserted that the agency has "exclusive jurisdiction" despite pushback from states that say platforms are violating local gaming and gambling laws, particularly related to sports-related bets. Last week, the agency sued New York and earlier sued Arizona, Connecticut and Illinois.
On Tuesday, Bloomberg also reported that discussions Polymarket has had with the CFTC involved merging the " primary exchange’s operations and blockchain-based technology with the domestic exchange’s licenses" and operating then just on the blockchain-based platform.
The CFTC did not immediately respond to a request for comment. Polymarket declined to comment.
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