REGULATION

Trump's winning odds rise, CFTC closely monitors prediction markets, reports of Polymarket increasing scrutiny on US users

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The Chairman of the U.S. Commodity Futures Trading Commission (CFTC), Rostin Behnam, stated in an interview with Bloomberg that the CFTC is working to ban politically related derivative trading markets through legal processes and will continue to regulate products that are already registered in the market. Additionally, Bloomberg pointed out that Polymarket is enhancing scrutiny for U.S. users.

Regulatory Challenges in Prediction Markets

Kalshi has won in court, although the CFTC is appealing in an attempt to overturn the decision. The victory allows Kalshi to continue operating, with Rostin Behnam stating:

The CFTC will continue to take regulatory action in these markets, consistent with our zero-tolerance approach to all markets, and will work to prohibit unlicensed betting on these platforms.

Could Polymarket be Affected? CFTC Appeals Kalshi Decision in Prediction Markets, Pursuing Concerns of Election Market Manipulation

Polymarket Strengthens Review for U.S. Users

Bloomberg points out that the mainstream prediction market Polymarket has strengthened its review for U.S. users. Although the platform should prohibit U.S. users from trading, certain large bettors have still found ways to circumvent restrictions.

A user with the alias "Fredi9999" has placed bets exceeding $18 million on Republican-related elections, with $13 million wagered on a Trump victory, making him the largest bettor on Polymarket. Twitter users @fozzydiablo, @Domahhhh, and the analysis firm Arkham Intelligence all indicate that Fredi9999 and three other accounts may be the same person, with a total bet exceeding $43 million.

However, sources disclosed to Bloomberg that none of these accounts are U.S. users.

Differing Results in Prediction Markets, Trump Still Leads Significantly

Trump's odds on Polymarket have already reached a significant lead of 65%:35%. Additionally, even in the crucial swing state of Pennsylvania, which is considered the key to winning the election, Trump also holds a significant advantage on Polymarket.

Polymarket has traded over $2.2 billion in the U.S. election market so far, and although results may vary slightly in other markets, they all show Trump's leading position:

  • Kalshi: 60%
  • PredictIt: 59%
  • RealClearPolitics Polls: 49.3%-48.5%

Furthermore, a Reuters/Ipsos poll Reuters/Ipsos shows Harris leading Trump by 46%-43%.