The Commodity Futures Trading Commission (CFTC) is heightening its focus on offshore cryptocurrency betting platforms like Polymarket.
According to the agency, platforms offering derivatives to US clients may face legal issues if they don't comply with US regulations.
CFTC Chair Rostin Behnam discussed the issue during an event at Georgetown University's Psaros Center for Financial Markets and Policy, stating that the agency is actively monitoring the activities of these platforms.
Did you know?
Want to get smarter & wealthier with crypto?
Subscribe - We publish new crypto explainer videos every week!
How to Pick the Right NFTs? (Animated DOs & DON'Ts)
Benham stressed:
If anyone—Polymarket or otherwise—conducts themselves in a way that breaks the law, we will use our civil enforcement authority to make sure that conduct stops.
He mentioned that Polymarket has already previously drawn regulatory attention. The CFTC issued it a $1.4 million fine in 2022 for operating as an "illegal unregistered or non-designated facility."
The recent surge in popularity of blockchain-based prediction markets has been fueled by an increase in bets on the 2024 US presidential election. The "Presidential Election Winner 2024" contract alone has attracted over $934 million in wagers, while the "Popular Vote Winner 2024" has drawn more than $208 million.
Thus, platforms involved in crypto betting and prediction markets are now on notice: legal noncompliance will not go unchecked.
