The Department of Justice (DOJ) and the Commodity Futures Trading Commission (CFTC) have each ended their respective investigations into cryptocurrency-focused predictions exchange Polymarket.
As first reported by Bloomberg on Tuesday, two investigations that were ramped up by the Joe Biden administration have been shut down by President Donald Trump’s administration.
The DOJ and CFTC each formally informed the company earlier this month that it is no longer under investigation, a source told Bloomberg.
Officially, Polymarket does not take action from U.S.-based consumers. It struck a settlement with the CFTC in January 2022 as a result of it allegedly failing to register with the federal derivatives regulator. As part of that agreement, Polymarket promised to block U.S. customers from its exchange.
The CFTC and the DOJ investigated whether the New York-based platform continued accepting money from Americans via other means.
The company’s profile rose last year as its popularity increased during last year’s election lead-up. Per Bloomberg, it recorded around $2.6 billion in trading volume in November alone. It also has a notable presence in offering sports markets, even running a soccer-focused Polymarket FC social media account, which it says it is the “home of the most accurate football odds in the world.”
Just last month, it hit headlines due to a landmark deal with X, formerly Twitter, which made the company the official prediction market partner of the social media giant. The collaboration will ultimately deliver an integrated product that provides Polymarket’s event-based markets with real-time data and insights from X to break down market movements, as well as use of X’s AI-powered assistant Grok.
‘Justice prevailed,’ says CEO
The week after the November election, FBI agents raided the home of Polymarket CEO Shayne Coplan, who called the move a “last-ditch effort” by the Biden administration.
On Tuesday, Coplan took to social media to address the end of the investigations.
“8 months ago, on election night, we were on top of the world after Polymarket called the election. 8 days later, the FBI broke down my door at 6am and took all my computers and phones, looking for anything that could imply foul play,” he wrote.
“While traumatic, it etched the story of Polymarket’s accuracy, and the ensuing resistance, into the history of American politics. And today, I’m happy to announce that this chapter of the story is over. After cooperating and engaging, we’ve been cleared of any wrongdoing. Justice prevailed. God Bless America.”
Are the winds changing?
Whether or not the end of the probes could lead to Polymarket officially re-entering the U.S. or registering with the CFTC is uncertain.
But the change of course comes at a time when a person with deep ties to prediction markets, Kalshi board member and former Crypto.com advisor Brian Quintenz, is earmarked as the next leader of the CFTC under Trump.
Quintenz spoke during a hearing in the Senate Committee on Agriculture, Nutrition, and Forestry last month and seemed to suggest that he would not look to take action as CFTC Chair to prevent prediction market operators from offering sports contracts, implying that such products are legal under the Commodity Exchange Act (CEA).
He wrote in a letter to the CFTC in May that he would step away from Kalshi upon taking up the CTFC leadership, as well as recuse himself from proceedings involving Kalshi to avoid a potential conflict of interest.
