A person with knowledge of the situation said that the Commodity Futures Trading Commission issued a subpoena to Coinbase in connection with the growing prediction market Polymarket. Decrypt Thursday.
A request from the regulator is sought “general customer information” A discussion of Polymarket, a blockchain-based platform for prediction that became famous in the lead-up to November’s elections. A screenshot Eric Conner of the Ethereum-information site ETHHub shared a screenshot of an email that Coinbase sent to users about the request.
Coinbase has sent out a notification that states the exchange is now closed. “may be required to send information” Conner could be referred to the CFTC if legal actions are taken within the week. Conner refused to comment. Decrypt You can ask him if he is familiar with Polymarket.
According to a person with knowledge of the situation, Decrypt Conner shared a screenshot that showed that the CFTC had served Coinbase a subpoena relating to Polymarket. The regulator was also requesting user data, as shown by Conner’s screenshot.
Biden's CFTC is subpoenaing customer info from @coinbase in their case against @Polymarket pic.twitter.com/YlCdUPwHs7
— eric.eth (@econoar) January 8, 2025
Polymarket, which will be launched in 2020, allows users to place wagers on various topics, ranging from politics to sports. Polymarket gained popularity last year as a result of the speculation around the U.S. election. The cryptosphere is in the spotlightIt has received a lot of interest from people outside of the industry because it correctly predicted Donald Trump’s re-election.
In 2022, the CFTC filed a complaint against Polymarket for failing to register their services. After a $1,4 million Settlement Polymarket was officially closed to U.S. Citizens with the CFTC.
The FBI started investigating Trump shortly after his victory. The raids Shayne Cplan, Polymarket CEO’s New York apartment. A Polymarket spokesperson claimed the move was an act of "political retribution.” Bloomberg News later reported that the raid was related to an investigation conducted by the Department of Justice.
Polymarket did not immediately respond to a request for comment from Decrypt.
With Trump’s administration set to take control of the White House in less than two weeks, the scrutiny applied to crypto firms could change under his leadership. Still, the subpoena sent to Coinbase suggests that the CFTC is pressing forward with an investigation in the meantime.
The CFTC did not immediately respond to a request for comment from Decrypt.
Even though Polymarket’s political wagers attracted billions of dollars in bets, the platform continues to show signs of growth despite lower trading volumes. Polymarket’s monthly active users increased to 349,500 last month, outpacing November’s record of 293,700, according to a Dune dashboard.
A spokesperson for Coinbase told Decrypt that requests for information from a government are carefully reviewed by a team of trained experts. In some instances, the firm will object to producing information if a request is legally insufficient, or seek to narrow it down.
“The spokesperson explained that in certain cases, we might be legally required to provide the necessary information requested by government.
Edward Snowden, a former NSA contractor who became a whistleblower in 2022 critiqued Coinbase is responsible for “toxic” and “embarrassing” behavior, according to the CEO.” levels of compliance. He cast shade broadly on exchanges that keep track of where users’ funds flow.
Though the U.S. presidential election provided Polymarket’s users with plenty of betting fodder, criminal and civil authorities began scrutinizing Polymarket months before the platform predicted Trump’s electoral victory, per Reuters.
Coplan told Decrypt last year that Polymarket was a more useful tool for assessing political outcomes than conventional polls. “It is amazing to hear that the incoming administration has been heavily influenced by Polymarket’s forecasts during the entire election cycle.” he said.
The CFTC has raised concerns about the potential of political event contracts to undermine elections’ integrity. Last year, the regulator failed to prevent Kalshi, another prediction platform, from listing contracts for November’s election after a federal court’s ruling.
Polymarket has been scrutinized by authorities both in the U.S. and overseas. In November, Polymarket voluntarily Blockage French gaming regulator to regulate online gambling for users Start your journey with us The company’s operation and conformity with gambling laws should be examined.