The Trump administration Tuesday took two big steps showing its softer stance on prediction markets than its predecessor, as PredictIt agreed to a less restrictive deal with the Commodity Futures Exchange Commission (CFTC), while the Department of Justice (DoJ) dropped its investigation into Polymarket.
PredictIt was a pioneer of prediction market betting in the U.S., originally launching in 2014 as a research project from Victoria University of Wellington in New Zealand. Due to its status as a research project, it was initially allowed to operate in the U.S. under a no-action letter from the CFTC, but with certain limits in place regarding bet size and participants in a given market.
In 2022, the CFTC withdrew its no-action letter and the site was ordered to close by February 2023. However, it secured a temporary injunction that allowed it to keep operating.
But Tuesday, an announcement posted on the PredictIt website described a “relaunch” of the exchange, following “renewed regulatory approval.” On social media site X, PredictIt thanked Acting CFTC Chair Caroline Pham for allowing the updates.
Higher bets allowed on PredictIt
The cap on bets made through the platform will increase from $850 to $3,500, in line with the individual campaign contribution limit.
Meanwhile, the limit on the number of traders on any one market — previously set at 5,000 — has been removed.
PredictIt also says that it is “dramatically expanding the number and diversity of markets available.” PredictIt currently offers only 25 markets, mostly covering election outcomes, but it did not reveal what the new markets may cover.
“We are pleased to announce the official relaunch of PredictIt, the pioneer in real-money political prediction markets, following renewed regulatory approval from Washington, DC,” the announcement said. “This moment marks more than a comeback. It’s a reinvention. With strengthened compliance protocols and an unwavering commitment to excellence, PredictIt returns from its regulatory pause not just as a leader — but as the benchmark for what real-money prediction markets can and should be. And at the core of it all: your insights.”
DOJ drops Polymarket probe
Meanwhile, the DoJ dropped its investigation into prediction exchange Polymarket, the company’s founder appeared to confirm after Bloomberg first reported the story.
The investigation, launched in November 2024, covered whether the platform — which is not registered with the CFTC and therefore is not permitted to accept U.S. customers — was continuing to knowingly accept trades from the U.S.
Polymarket founder and CEO Shayne Coplan — who was subject of a November 2024 FBI raid linked with the investigation — wrote on X that the business was “cleared of all wrongdoing.”
The federal government appears to have adopted a lenient approach towards prediction markets since Donald Trump’s inauguration in January.
Trump’s pick to run the CFTC — Brian Quintenz — signaled during his Senate confirmation hearing in June that he welcomed prediction markets and would not stop them from offering event contracts on sports. The full Senate has not yet voted on Quintenz’s nomination. The president’s son, Donald Trump, Jr., is a special advisor to Kalshi.
Polymarket appeared to align itself with the then-incoming Trump administration following the search of Coplan’s home, arguing that the raid was “obvious political retribution by the outgoing administration against Polymarket for providing a market that correctly called the 2024 presidential election.”
