U.S. Regulation

Gemini Wins CFTC Approval For Prediction Market, May Expand into Crypto Futures, Options and Perps

Crypto exchange Gemini Space Station, Inc. (ticker GEMI) has been cleared to enter the prediction market arena, having received approval from the Commodity Futures Trading Commission to operate a Designated Contract Market on Wednesday. 

The betting platform, called Gemini Titan, will begin by offering classic binary event contracts, i.e., “simple yes or no questions on future events,” Gemini said in a statement. In time, the platform may expand into other derivatives markets overseen by the CFTC, like crypto futures, options, and perps. 

Gemini first applied for a DCM license on March 10, 2020, according to the statement. However, the application at the time did not make clear whether Gemini was looking to launch a predictions market platform. A designated contract market is a general term for most CFTC-registered and regulated trading facilities. 

The two largest prediction markets, Kalshi and Polymarket, saw significant growth during the U.S. election cycle last year that has only accelerated since President Donald Trump took office.  The pair recorded their two best months consecutively in October and November, and are on track to see similar volumes this month, according to The Block’s data.

For years, the CFTC took a conservative approach to the sector, banning Polymarket and only cautiously allowing Kalshi to list new event contracts. However, Kalshi won a legal fight against the CFTC related to political betting markets, opening the door to further expansion into sectors like sports betting.

Under Trump’s second term, the CFTC, led by Acting Chair Caroline Pham, has signaled even greater support for prediction markets. Trump’s social media firm is also planning to launch a Truth Social prediction market with Crypto.com. 

“Prediction markets have the potential to be as big or bigger than traditional capital markets. Acting Chairman Pham understands this vision and its importance,” Gemini President Cameron Winklevoss said. ”Unlike her predecessor, Acting Chairman Pham has positioned the CFTC as a pro-business, pro-innovation regulator that will allow America to lead in these new and exciting markets.”

The Winklevoss twins, Cameron and Tyler, voiced concerns about Trump’s initial pick to lead the CFTC, Brian Quintenz, due to potential financial biases, given his position at the a16z venture firm and board seat at Kalshi, The Block was first to report

Gemini is not the first U.S. exchange to move into the predictions market. As mentioned, Crypto.comis powering several branded predictions platforms while Coinbase appears to be testing code for a betting market in its wallet. At times, distribution partner Robinhood has accounted for more than 50% of Kalshi’s market volumes.

Terron Gold

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