As a seasoned crypto investor with over a decade of experience navigating the ever-evolving digital asset landscape, I wholeheartedly support Gemini and Coinbase’s stance against the proposed regulation banning event contracts on decentralized prediction markets like Polymarket.
Gemini, a financial services company, has officially asked U.S. authorities to rethink a proposed regulation that forbids event contracts in decentralized prediction markets, such as those found on Polymarket, a widely recognized prediction market platform.
In a letter dated August 8th, addressed to Christopher Kirkpatrick, Secretary of the U.S. Commodity Futures Trading Commission (CFTC), Gemini expressed concerns about potential negative consequences of the proposed rule. The digital asset exchange contends that prohibiting these markets might decrease transparency and hinder innovation in forecasting diverse events, including elections, by limiting predictive capabilities.
Cameron Winklevoss, one of the co-founders of Gemini, expressed apprehensions about X, noting that decentralized prediction markets necessitate individuals to stake their funds on their forecasts. This, in his view, enhances the truthfulness and precision of the prophecies.
Decentralized forecasting platforms represent an important advancement, offering genuine public benefit. These systems offer reliable predictions about upcoming events based on financial responsibility. In contrast to surveys, opinions from commentators, or the views of experts, they compel users to back up their convictions with actual investments.
— Cameron Winklevoss (@cameron) August 10, 2024
“Winklevoss suggested that the Commodity Futures Trading Commission (CFTC) should reconsider its proposed prohibition on all event contracts within the U.S., including those traded on platforms like Polymarket, which is known as the world’s largest prediction market.”
Similarly to Gemini, the cryptocurrency exchange Coinbase has voiced its disagreement with a specific regulation. According to Paul Grewal, Coinbase’s top legal officer, this rule fails to acknowledge the advantages of forecasting markets. Grewal emphasized the need for a fair balance in policy-making that fosters innovation while addressing public apprehensions.
We urge the CFTC to withdraw this proposal and work alongside academic, industry, and policy stakeholders to develop a more balanced approach that promotes innovation while protecting the public interest. As always, we appreciate the CFTC’s consideration of our response and look…
— paulgrewal.eth (@iampaulgrewal) August 9, 2024
The proposed regulation comes amid renewed scrutiny from five Senators and three House Representatives, who have recently urged the CFTC to ban betting on the 2024 presidential election. They argue that such markets could potentially influence the election and undermine public trust in democratic processes.
The debate around this proposed rule has gained momentum as Polymarket reported record trading volumes in July, driven by increased speculation about the upcoming presidential election.
Based on data from Dune Analytics, Polymarket recorded a trading volume of approximately $387 million over the past thirty days.
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2024-08-10 15:17