After a three-year regulatory exile, Polymarket is making a landmark return to the United States with a crucial green light from the Commodity Futures Trading Commission (CFTC). This approval marks a significant victory for the prediction market giant, allowing it to operate as a fully regulated, intermediated trading venue for U.S. users through traditional brokerages and financial institutions. The move signals a maturation of the event-based trading sector and opens a new chapter of compliant, institutional-grade access for American traders.
From Regulatory Enforcement to a Formal Approval
Polymarket’s journey back to the U.S. market is a story of regulatory navigation. The platform’s initial model attracted scrutiny, resulting in a $1.4 million fine from the CFTC in 2022 for operating an unregistered derivatives exchange and a subsequent ban on U.S. users. To pave a compliant return, the company executed a strategic acquisition in 2025, purchasing the regulated derivatives exchange and clearinghouse QCX LLC and its clearing arm for $112 million. This provided the essential licensed infrastructure. The breakthrough came with the CFTC’s issuance of an “Amended Order of Designation” in late November 2025, formally authorizing Polymarket to operate within the federal regulatory framework that governs other derivatives exchanges.
A Structural Transformation for the U.S. Market
This regulatory endorsement is more than a procedural checkmark; it represents a fundamental transformation of Polymarket’s U.S. operations. The platform will now offer “intermediated access”, meaning U.S. participants will trade through registered Futures Commission Merchants (FCMs) and traditional brokerages, integrating prediction markets into the mainstream financial system. To meet the stringent requirements of a Designated Contract Market, Polymarket has implemented enhanced market surveillance systems, updated clearing procedures, and robust regulatory reporting capabilities. The platform is initially rolling out access via a mobile app and waitlist, starting with sports-related markets.
Implications for a Rapidly Evolving Sector
Polymarket’s re-entry is set to intensify competition in the growing prediction market space, where it will directly challenge Kalshi, another CFTC-regulated platform. The sector has seen explosive growth, with weekly trading volumes nearing $1 billion, driven by major events like elections. The legitimacy conferred by CFTC oversight is expected to attract greater institutional interest and capital to event-based trading. However, the industry faces ongoing challenges, including questions about market integrity and the persistence of “wash trading” activity that can inflate volume metrics. Despite this, the relaunch underscores a pivotal shift, proving that innovative crypto-native platforms can successfully transition into the regulated financial landscape.
