Polymarket launched contracts in May 2026 allowing users to wager on milestones of approximately 1,600 private companies. These assets, with a combined valuation exceeding $5 trillion, cover events such as IPO timing and valuation thresholds. Data for these markets is sourced from Nasdaq Private Market and is restricted to the platform's offshore version, inaccessible to US residents.
The company operates in the US through QCX LLC, a subsidiary acquired in July 2025 that is regulated by the CFTC. Previously, in 2022, Polymarket settled with the CFTC for $1.4 million regarding unregistered activity. The domestic platform currently offers prediction markets based on public stock metrics, including S&P 500 performance and market capitalization rankings.
Legal experts suggest that equity-linked contracts might be classified as security-based swaps, potentially shifting jurisdiction from the CFTC to the SEC. Such a classification would impose strict registration and disclosure requirements. Furthermore, on September 24, 2026, New York officials filed a lawsuit against the platform, alleging illegal gambling operations related to sports contracts.
The legal status of prediction markets remains uncertain, particularly regarding whether federal preemption protects them from state-level gambling laws. Regulators are concerned about information asymmetry, as insiders may possess nonpublic data. If the SEC reclassifies these contracts, Polymarket would face mandatory reporting and compliance obligations under Regulation SCI.
