Polymarket Faces Fresh Scrutiny Over US Betting Restrictions
US regulators are investigating whether prediction market operator Polymarket violated a 2022 settlement requiring it to prevent American customers from accessing its offshore trading platform.
The Commodity Futures Trading Commission (CFTC) is examining the company’s geographic restrictions, US advertising activities and customer protection measures, according to an October 27 investigation by Reuters.
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The inquiry raises fresh questions about Polymarket’s compliance as prediction markets expand their presence in the United States.
The investigation reportedly focuses partly on whether the company took sufficient steps to prevent US residents from accessing its international platform.
Regulators are also examining customer onboarding procedures and safeguards associated with Polymarket’s newer US operation, which began rolling out in late 2025.
The latest scrutiny follows a $1.4 million settlement reached with the CFTC in January 2022.
Under that agreement, Polymarket was required to stop offering its unregistered event-contract products to US customers.
The company subsequently introduced geographic restrictions intended to prevent Americans from accessing its offshore platform.
However, questions have persisted about whether customers could circumvent those restrictions using virtual private networks and other methods.
A previous investigation by the CFTC and Department of Justice was closed in 2025 without enforcement action.
Reuters reported that the current inquiry forms part of a broader investigation opened earlier this year.
Polymarket has maintained that it prohibits customers from using VPNs to bypass geographic restrictions and operates systems intended to identify prohibited activity.
The company’s global head of investigations and intelligence, Shana Bautista, previously told Reuters that attempts by American customers to circumvent its restrictions were not widespread.
The investigation comes as Polymarket seeks to expand its regulated US business.
The company acquired a CFTC-licensed derivatives exchange in 2025, providing a route to offering event contracts through a federally supervised platform.
Prediction markets have become a major regulatory issue in the United States, with state gambling authorities challenging the legality of sports-related contracts offered by federally registered exchanges.
The CFTC maintains that qualifying event contracts fall under federal derivatives legislation, while several states argue that sports contracts constitute gambling and must comply with local licensing requirements.
Spokespeople for Polymarket and the CFTC declined to comment on the latest investigation, with no finding of wrongdoing announced, and the inquiry may conclude without enforcement action.
