Online betting platform Polymarket said it acquired QCEX, US-licensed derivatives exchange and clearinghouse for $112 million, paving the way for the company’s return to the United States after a hiatus of more than two years.
According to its website, QCEX is based in Boca Raton, Florida, with both entities, the derivatives exchange and the clearinghouse, under the oversight of the Commodity and Futures Trading Commission (CFTC).
Polymarket is a decentralized prediction market platform that lets users trade on the outcomes of real-world events, such as election results and sports events. According to Token Terminal, trading volume on the prediction platform surpassed $15 billion over the past year.
“…with the acquisition of QCEX, we are laying the foundation to bring Polymarket home — re-entering the US as a fully regulated and compliant platform that will allow Americans to trade their opinions,” founder and CEO of Polymarket Shayne Coplan said in a press release.
On Tuesday, Bloomberg reported that the US Department of Justice (DOJ) and CFTC had dropped their investigations into Polymarket. The agencies reportedly were looking into whether Polymarket had accepted trades from US-based users.
Polymarket exited the US in January 2022 after settling charges with the Commodity Futures Trading Commission (CFTC) over claims that the platform offered event-based binary options without registering with the agency. As part of the settlement, Polymarket paid a $1.4 million fine and agreed to block US users from accessing its markets.
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Polymarket competitors and prediction market pushback
The company will reenter the US market with a couple of well-known competitors. Cryptocurrency exchange Crypto.com debuted its prediction platform in the US in May, while Kalshi has partnered with retail investing platform Robinhood to offer a range of prediction market contracts.
In late June, Kalshi and Polymarket announced new fundraises: $185 million at a $2 billion valuation for Kalshi and $200 million at a $1 billion valuation for Polymarket.
Prediction markets, which harness “the wisdom of the crowds,” could be a tool to allow people to see a glimpse into the future, according to some commentators. However, they have received pushback at times from gambling institutions and sports leagues.
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