CFTC is reportedly investigating Defi prediction Polymarket


As per a report, the United States Commodity Futures Trading Commission (CFTC) is investigating Polymarket which is a New York-based decentralized prediction market to check whether the platform is allowing its users to trade swaps or binary options and if it should be registered with the financial regulator.
According to the
report due to the talk regarding a new round of funding with anonymous sources
led the CFTC to start investigating Polymarket as this new funding could lead the
company valued at $1 billion. Although the CFTC declined to say anything on
this. The answer given by Polymarket doesn’t much confirm nor decline the existence
of any probe. Entrepreneurs of Decentralized finance (Defi) have argued that
smart contract interfaces shouldn’t have policies like centralized exchanges.
From the platform, a spokesperson said, “Polymarket is firmly committed to
complying with applicable laws and regulations and to providing information to
regulators that will assist them with any inquiry.” As per a report, James
McDonald, the former director of the CFTC enforcement division and partner at
legal firm Sullivan & Cromwell was engaged by Polymarket to address the
probe.
Other funding rounds by Polymarket:
In a funding round held in October 2020, where Meltem Demirors CoinShares CSO, Balaji Srinivasan former Coinbase CTO, and Naval Ravikant AngelList CEO took participation, Polymarket earned $4 million. It was that led by Polychain Capital.
Other firms offering
decentralized prediction markets:
At the beginning of October Polymarket along with Augur introduced a Polygon deployment of its platform. It offers an eclectic range of markets along with the speculation on COVID case numbers, CryptoPunks floor prices, and Donald Trump’s presidency. Crypto price predictions and sports forecasting are currently the main focus points for Augur markets.

Indrani Bose
CBW - External Analyst
INDIA