Despite heightened U.S. regulatory scrutiny, the popular crypto-based betting platform Polymarket has secured funding to expand its global operations, overcoming restrictions.
Peter Thiel’s venture capital firm, Founders Fund, and Ethereum co-founder Vitalik Buterin have led a $70 million fundraising effort for Polymarket, a platform that facilitates betting on political events.
Bloomberg reports that Polymarket successfully secured $70 million across two funding rounds, driven by the rising interest in betting on the 2024 United States presidential elections. The latest Series B funding round, led by Founders Fund, raised $45 million.
Despite the Commodity Futures Trading Commission (CFTC) proposing bans on political contest betting, the crypto-based prediction market is flourishing. Addressing the proposed ban, Founders Fund partner Joey Krug stated:
“Much of the opposition to prediction markets in the US stems from outdated puritanical views on betting. In the short to mid-term, this benefits Polymarket as they focus on non-US markets. Ultimately, it will be advantageous for Americans to have access to this market as well.”
Krug notes that Founders Fund’s investment marks its first venture into event-betting contracts.
Polymarket, previously fined by the CFTC and having agreed to scale back its U.S. services as part of a settlement, has since appointed former CFTC head J. Christopher Giancarlo as chairman of its advisory board to improve its regulatory standing.
The platform has seen significant betting volume, especially with the approaching U.S. presidential elections. Known for facilitating bets on various events, Polymarket allows users to purchase shares with USD Coin without holding customer funds.
Under the leadership of 25-year-old founder Shayne Coplan, Polymarket has experienced a surge in electoral betting, with over $170 million in wagers placed on the upcoming U.S. elections. Coplan asserted:
“When we consider the U.S. market and our investment research, we understand that immediate returns are unlikely. However, we are deeply convinced that markets on a wide array of topics people are curious about and have strong opinions on will thrive.”
Despite successful funding rounds, Polymarket’s regulatory challenges have impacted its current valuation, which previously hovered around $1 billion.