"Market prediction leader" Polymarket will return to the US at the end of November, focusing on sports betting services.

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After being expelled from the United States for nearly three years due to illegal trading, prediction market platform Polymarket is preparing to re-enter the U.S. market and plans to shift its business focus to sports betting.

On October 28, according to media reports citing sources, Polymarket may launch before the end of November, but will not be open to all users initially. Choosing this timing may allow Polymarket to gain more trading volume during the peak season of American football and basketball.

In 2022, Polymarket paid a $1.4 million fine and was expelled from the U.S. domestic market to settle allegations by the U.S. Commodity Futures Trading Commission of engaging in illegal trading.

After the news was reported, shares of American betting companies fell in response. DraftKings' stock price dropped more than 5%, and FanDuel's parent company Flutter Entertainment fell 3%.

It is worth noting that earlier that day, these betting stocks were already under pressure as Trump's social media company announced its entry into the sector via a partnership with Polymarket’s rival Crypto.com.

Paving the Way for Compliance through Licensed Companies

To ensure compliance upon this return, Polymarket has taken key strategic steps.

Wallstreetcn previously mentioned that after the U.S. Department of Justice and CFTC dropped their investigation into the crypto betting platform earlier this year, Polymarket acquired QCX.

QCX has obtained derivatives exchange and clearing house licenses from the CFTC, a move considered Polymarket’s core strategy for re-entering the U.S. market.

Currently, Polymarket’s U.S. website has set up a waitlist for users to register and receive updates. Its website states:

We are working hard to prepare for the launch of the U.S. platform.

Industry Boom: Prediction Markets Surging in Popularity

Polymarket’s return comes as the entire prediction market industry is experiencing explosive growth.

Platforms such as Polymarket and Kalshi allow users to bet on a wide range of events, from Oscar winners to central bank rate decisions.

Last year, its competitor Kalshi won a lawsuit against U.S. regulators, obtaining permission to offer so-called “event contracts” on topics such as presidential election outcomes, greatly advancing the industry.

Recent trading volumes have surged to record levels, largely because these exchanges leverage their federal financial licenses to conduct related business in states where sports betting was previously prohibited.

This model has attracted attention from many major institutions. According to Bloomberg, financial giant CME Group is considering launching its own sports betting contracts by the end of the year after partnering with FanDuel.

Regulatory Clouds: Continued Tussles with State Agencies

Despite the positive industry outlook, prediction market companies still face a complex regulatory environment and ongoing legal challenges in the U.S.

Regulators in some states have explicitly stated that prediction markets are not allowed to operate in their state, bringing uncertainty to the industry's expansion.

The legal battles continue.

On Monday, Kalshi filed a lawsuit against the New York State Gaming Commission, accusing the agency of attempting to regulate sports betting operations that fall fully under federal jurisdiction, an overreach of power.

This lawsuit highlights the tensions between prediction market platforms seeking nationwide operations and state-level regulatory authority, and also hints that companies like Polymarket may face similar challenges in the future.

Risk Disclosure and DisclaimerThe market involves risk, and investment requires caution. This article does not constitute personal investment advice and does not take into account the particular investment objectives, financial situation, or needs of individual users. Users should consider whether any opinions, viewpoints, or conclusions in this article are suitable for their specific circumstances. Investment is at your own risk. ```