Polymarket is facing renewed scrutiny from the U.S. Commodity Futures Trading Commission (CFTC) over whether it followed the access restrictions included in its $1.4 million settlement in 2022, according to Reuters.
The review reportedly looks at how the company restricted U.S. users from accessing its offshore prediction market, including its location controls, advertising, and safeguards on its separate U.S. platform.
Federal authorities closed earlier investigations without filing charges in 2025, but neither the CFTC nor the Justice Department publicly explained those decisions. The latest review does not mean regulators have concluded that Polymarket violated its settlement.
Reuters reported on October 27, citing two people familiar with the matter, that the review is part of an investigation opened earlier this year. Polymarket is based in New York and operates an offshore entity registered in Panama.
Neither Polymarket nor the CFTC commented on the report.
The earlier investigations examined whether Polymarket had complied with its settlement. In November 2024, the FBI searched the home of CEO Shayne Coplan. Both investigations ended without charges in 2025, and authorities did not publicly explain why they were closed.
The original settlement dates back to January 3, 2022. At the time, the CFTC identified Blockratize, Inc., doing business as Polymarket, as the respondent. The agency found that the company had offered event-based binary options without registering as a swap execution facility or obtaining designation as a contract market.
According to the CFTC, Polymarket had operated the unregistered platform since around June 2020 and offered more than 900 event markets. These covered topics such as cryptocurrency prices, public health figures, and election results, with trades handled through blockchain-based smart contracts.
The company agreed to pay a $1.4 million civil penalty and close markets that did not comply with U.S. rules. The CFTC said Polymarket’s cooperation with the investigation helped reduce the penalty.
The settlement order also set specific deadlines. By January 14, 2022, Polymarket had to stop providing access to noncompliant markets, resolve affected markets, and make funds available for full redemption by users with open positions. The company then had to certify by January 24 that it had met those requirements and was no longer offering access to trading unless it complied with applicable laws and regulations.
Blockratize accepted the settlement without admitting or denying the CFTC’s findings and conclusions, subject to the order’s terms.
The original order also described a simple account-opening process in which users provided an email address and chose a username, without needing to submit other identifying information to begin trading. Those findings related to the platform during the period covered by the 2022 investigation.
Polymarket later took steps to establish a regulated U.S. operation. In July 2025, it completed a reported $112 million acquisition of QCEX, a derivatives exchange and clearinghouse licensed by the CFTC. The deal provided regulatory infrastructure for the company’s return to the American market through a domestic business.
QCEX, based in Boca Raton, Florida, held licenses as a designated contract market and a derivatives clearing organization.
By August 31, 2026, Polymarket was describing its U.S. exchange as separate from its international blockchain platform. Shana Bautista, the company’s global head of investigations and intelligence, told Reuters that its controls could prevent the vast majority of Americans from using the offshore service.
Bautista, a former FBI investigator and Coinbase analyst, said the company uses machine learning, blockchain analytics, trade surveillance, open-source research, and outside services to monitor activity. Discussing attempts to get around location restrictions, she said she did not consider the problem widespread.
Polymarket has also said its trade surveillance and investigations have generated more than 100 referrals to law enforcement. That figure and the company’s assessment of its controls are based on its own statements.
The company’s advertising practices have faced scrutiny as well. In June, the CFTC was reportedly investigating aspects of Polymarket’s business and marketing, including its social media activity. Following allegations involving promotional videos, Polymarket told CNBC it was reviewing active promotional content to check compliance with company standards and legal disclosure requirements.
Senators Adam Schiff and John Curtis also asked CFTC Chair Michael Selig about the agency’s oversight of advertising, influencer disclosures, age verification, and consumer protections. They questioned how the regulator was preventing the offshore platform from attracting U.S. users after the 2022 settlement.
In August, New York City Council Speaker Julie Menin sought information from Polymarket, Kalshi, Coinbase, and Gemini Titan about how their event-contract products were marketed to consumers. The council’s inquiry focused on marketing and consumer protection, rather than whether the exchanges had violated state gambling laws. Menin’s office said a hearing would form part of the investigation.