The U.S. Department of Justice (DOJ) and Commodity Futures Trading Commission (CFTC) have officially ended their investigations into Polymarket, a popular blockchain-based prediction market platform.
The closure of the probes launched in the final months of the Biden administration indicates a broader regulatory shift under President Trump, whose administration has adopted a more crypto-friendly stance.
Polymarket Cleared as DOJ and CFTC Close Probes Without Action
According to a Bloomberg report published Tuesday, Polymarket was formally notified earlier this month that both the DOJ and CFTC had concluded their inquiries without pursuing further action.
The investigations sought to determine whether the New York-based platform continued to allow U.S. residents to place bets despite a 2022 settlement with regulators that banned such access.
Neither the DOJ nor the CFTC issued public comments on the case, and Polymarket itself has remained measured in its response.
Still, CEO Shayne Coplan shared his reflections in a personal post on X, offering rare insight into the toll the scrutiny had taken.
“Eight months ago, on election night, we were on top of the world… Eight days later, the FBI broke down my door at 6am and took all my computers and phones,” he wrote.
Coplan described the experience as traumatic but said it showed Polymarket’s accuracy and resilience. He confirmed the company has been cleared of wrongdoing, stating, “Justice prevailed. God Bless America.”
Polymarket allows users to bet with cryptocurrency on real-world outcomes, from election results and geopolitical conflicts to economic indicators and proposed legislation. The platform rose to prominence during the 2024 U.S. election cycle, when users speculated heavily on Donald Trump’s chances of returning to office.
That wave of attention, however, brought scrutiny. In 2022, the CFTC fined Polymarket $1.4 million, accusing it of running an unregistered derivatives platform and ordering it to block U.S. users from placing bets.
While Polymarket complied officially, regulators suspected the platform may still have been accessed by American traders using VPNs or other tools to circumvent the ban.
The situation escalated dramatically in November 2024, just days after the election, when the FBI raided Coplan’s Manhattan residence and seized electronic devices in a surprise early morning operation.
The investigation, which also involved the CFTC, focused on whether Polymarket had violated its earlier agreement by allowing disguised U.S. trading activity to continue. As part of the settlement, the company committed to geo-blocking U.S. residents.
In response to the closure of the investigation, Coinbase CEO Brian Armstrong publicly decried the DOJ’s actions, saying, “This was one of the most egregious examples of lawfare from the last administration that should never have been possible in America. Imagine having your door broken down for predicting an election.”
Armstrong continued, adding that “The onus was on the government to prove there was something worth pursuing here, and they failed to do that. This is how you lose trust in institutions.”
Polymarket Eyes U.S. Comeback Amid Pro-Crypto Policy Shift
The decision to drop the investigations reflects a broader change in Washington’s stance toward digital assets and prediction markets under the Trump administration.
At its peak in November 2024, Polymarket recorded a staggering $2.6 billion in monthly trading volume. While volume dipped to $1.1 billion in May 2025, activity remains strong.
Polymarket now hosts over 21,000 markets with 1.2 million users and $700 million in active trading. With the DOJ and CFTC inquiries officially closed, industry watchers believe Polymarket may explore reentering the U.S. market in a more regulated form by either registering as a designated contract market (DCM) under the CFTC or acquiring a firm with an existing license.
While the platform will reportedly be working its way back into the U.S., it did not stop developing even during the CFTC and FBI investigations. Polymarket is in the midst of a major expansion effort, reportedly closing in on a $200 million funding round led by Peter Thiel’s Founders Fund.
Additionally, the platform recently announced a partnership with Elon Musk’s X and its AI division, xAI, to integrate prediction markets into the social media platform. Under this arrangement, Polymarket will offer real-time event forecasts that appear alongside user posts and commentary.
Still, the platform faces scrutiny outside the U.S. Authorities in France, Belgium, Thailand, Taiwan, and Singapore have also placed restrictions on Polymarket, often citing gambling law violations.
Allegations of market manipulation have also surfaced, although none have resulted in formal charges.
Polymarket’s main rival, Kalshi, recently won a legal victory against the CFTC when the watchdog moved to voluntarily dismiss its appeal of a ruling in Kalshi’s favor, effectively conceding that election betting contracts may have a place in the American financial sector.
With Polymarket now legally in the clear, the question is whether the U.S. will allow the platform to operate under a regulated framework.
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