Senators Call for CFTC Probe Into Polymarket
U.S. Senators Adam Schiff and John Curtis are urging the Commodity Futures Trading Commission to investigate Polymarket over allegations of misleading advertising.
The lawmakers have also requested a written response confirming whether the regulator has already opened an investigation into the crypto prediction market platform.
Polymarket Accused of Misleading U.S. Consumers
In a letter addressed to CFTC Chair Michael Selig, the senators said the allegations require immediate attention if they are proven accurate.
Their concerns follow a Wall Street Journal report claiming that Polymarket used simulated trading platforms, staged transactions and paid influencer promotions to advertise markets that were unavailable to U.S. customers.
According to the report, some creators were allegedly paid to record trades using fake websites. In addition, certain influencers reportedly failed to disclose that their content was sponsored.
The advertisements also allegedly used fabricated materials to make potential winnings appear larger. Lawmakers believe these campaigns were designed to attract audiences in the United States.
CFTC Asked to Respond by July 10
The CFTC has not yet publicly addressed the allegations against Polymarket.
Schiff and Curtis have asked the regulator to provide a written response by July 10. The response must confirm whether an investigation is underway. Should the CFTC decide not to investigate, the senators want the agency to explain its reasoning.
The CFTC regulates prediction market platforms such as Polymarket and Kalshi. These platforms generally offer event contracts structured as swaps, placing them under the regulator’s authority.
Lawmakers Raise Consumer-Protection Concerns
The senators are also questioning the consumer-protection rules currently applied to prediction markets.
They want the CFTC to explain its standards for advertising, age verification, addiction warnings and responsible-gaming tools. The letter also requests details about affiliate marketing practices and influencer disclosure requirements.
Furthermore, the lawmakers asked whether the CFTC has enough authority, expertise and resources to provide the same level of oversight offered by state and tribal gaming regulators.
Dispute Over Prediction Market Regulation
The CFTC has taken legal action against several states while defending its claim of exclusive authority over prediction markets.
Recently, the regulator sued Kentucky following the state’s actions against Polymarket and Kalshi. The lawsuit seeks to prevent Kentucky from enforcing state gambling laws against the platforms.
However, Schiff and Curtis warned that prediction market companies should not use federal oversight as a way to bypass state and tribal gaming regulations.
They also urged the CFTC to prevent platforms from weakening consumer protections or promoting betting-style products through misleading advertising campaigns.
The lawmakers’ request adds further pressure on Polymarket as regulators continue to debate how prediction markets should be supervised in the United States.
