Polymarket trade can commence in the United States as early as Thursday; thus, the company is bouncing back after years of regulatory limitations.
The prediction market operator plans to reopen its platform after receiving approval from the Commodity Futures Trading Commission, which will enable it to operate legally in the country.
Early launch date set ahead of schedule
Policymarket regulatory filings indicate that Policymarket might be opened to the US users ahead of schedule. Early reports indicated that October 7 would be the first day of trading, but revised reports submitted to the CFTC on Wednesday shifted the date to October 2. People who have visited the platform’s site have been redirected to a waiting list, where they will be notified when registration opens for Americans.
Polymarket DCM license filing. Source: CFTC
The firm has managed to reestablish itself through the acquisition of QCX LLC, which was later rebranded as Polymarket US at a cost of $112 million. It was acquired in July, and the company received a Designated Contract Market license, which allowed it to certify its own prediction markets. These will consist of political outcome contracts and sporting events contracts.
Settlement cleared the path for return
In January 2022, Polymarket discontinued operations in the United States following a settlement with regulators. The CFTC also imposed a fine of $ 1.4 million on the company for conducting its activities as an unregistered exchange and trading unauthorized event-based contracts. The agreement required Polymarket to block US users, but it still functioned abroad.
Its acquisition of QCX was followed by months of talks with regulators. The company was awaiting the no-action letter, which would save it the trouble of continued enforcement. That was approved in early September, as CEO Shayne Coplan called it, the final nod to re-enter the American market.
Competition with Kalshi intensifies
The reentry by Polymarket puts it in direct competition with the federally regulated exchange Kalshi, which controls the US prediction market space. Polymarket Analytics reports a trading volume of 877 million on the platform, versus the 291 million on Kalshi.
In August, it also bolstered its strength by adding Donald Trump Jr. to its advisory board. His venture capital company, 1789 Capital, has acquired a minority ownership stake in the company; however, the amount of the investment was not disclosed. Trump Jr. comes in as Polymarket plans to venture into a market where political activities are likely to attract significant trading.
The ongoing federal government shutdown is already the center of attention on prediction markets, which started following the failure of lawmakers to agree on the budget. On Kalshi, the dismantling process is estimated to take approximately 11 days, as per the contracts. In Polymarket, traders are less optimistic, with large bets on the shutdown lasting beyond October 15.
According to contracts on Polymarket, 8% of the participants anticipate a deal being made this week, between October 3 and October 5. Approximately 28% expect a solution between October 6 and 9, and 29% expect to see a solution between October 10 and 14. The stalemate remains ongoing as Republican and Democratic senators debate spending bills.
