Key Takeaways:
Polymarket's US affiliate filed for a futures commission merchant license, setting up a direct regulatory showdown with rival Kalshi for control of the leveraged prediction market business.
Polymarket's US affiliate, Coming Home GBA LLC, applied for a futures commission merchant license with the National Futures Association on July 3, according to NFA records cited by Bloomberg, the latest step in the platform's effort to rebuild its American business after a four-year ban. The company also needs approval from the Commodity Futures Trading Commission to amend its rulebook before it can offer contracts that are not fully collateralized.
"Margin trading would allow users to post collateral rather than fully fund every position, increasing capital efficiency but also introducing risks around leverage and liquidations," a Polymarket representative said, according to the Bloomberg report.
The FCM license would let Polymarket handle customer funds and margin requirements in the same way as traditional futures brokers, mirroring the regulatory framework that rival Kalshi secured in March through its affiliate Kinetic Markets LLC. Under current rules, traders on Polymarket must fully collateralize every position, limiting leverage and reducing the venue's appeal to professional traders and market makers.
The application comes as prediction markets surge into the financial mainstream. Industry volumes reached $51 billion last year and are on pace for roughly $240 billion in 2026, according to industry data. Bernstein analysts said in April they expect volumes to hit $1 trillion by 2030 as the sector evolves from niche wagering into broad "information markets" spanning sports, crypto, politics and the economy.
The US comeback strategy
Polymarket's push into regulated margin trading follows a $112 million acquisition of QCEX, a CFTC-licensed derivatives exchange and clearinghouse, in 2025. That deal gave the company a regulated on-ramp back into the American market after it agreed to stop serving US customers in 2022 as part of a $1.4 million settlement with the CFTC, which alleged the platform had operated unregistered event-based binary options.
The company this week also launched a marketing campaign aimed at convincing policymakers and potential users that the platform is trustworthy after its four-year absence from the US market, CoinDesk reported Wednesday.
The regulatory hurdles ahead
Even with an FCM license, Polymarket faces a dual approval process. The CFTC must sign off on rulebook changes allowing non-fully-collateralized contracts, and users trading margined positions would face enhanced identity verification, including disclosure of employer details.
The broader legal environment remains uncertain. A federal judge this week rejected Kalshi's attempt to block New York from enforcing state gambling laws against its sports-event contracts, Reuters reported, underscoring the legal friction between federal derivatives regulation and state gaming oversight.
If approved, margin trading could accelerate the institutionalization of event markets and help Polymarket close the gap with Kalshi's regulated US expansion. If rejected or delayed, the platform's US comeback may remain limited to simpler, fully funded contracts.
This article is for informational purposes only and does not constitute investment advice.
