The broker will list the prediction market! Your brokerage app can bet on The Federal Reserve (FED) lowering interest rates.

Polymarket obtained CFTC approval through the acquisition of QCX LLC and QC Clearing, allowing it to operate as a regulated exchange in the United States. This means that the integration of prediction markets and brokers is imminent, and macro, political, and financial policy bets can be traded through traditional brokerage apps. However, a Nevada judge ruled that sports event contracts are not subject to CFTC regulation but are governed by state gambling laws.

Polymarket Regulatory Breakthrough: From Gray Area to Mainstream Finance

The revival of Polymarket is not solely reliant on hype or speculation, but is built on a solid regulatory foundation. Earlier this year, the company acquired QCX LLC and QC Clearing, both of which have received approval from the CFTC. This move lays a solid regulatory groundwork for its bold expansion plans, marking a key turning point for the prediction market from the gray area to compliance.

In September 2025, the CFTC issued a no-action letter providing an exemption for QCX/QC clearinghouse under certain event contract recordkeeping and reporting exemption provisions. This exemption effectively restored a legal avenue for Polymarket to serve U.S. customers under traditional trading and clearing frameworks. Ultimately, in late November 2025, Polymarket received a “revised designated order”, officially allowing it to operate as a regulated exchange in the United States. According to the order, brokers and futures commission merchants (FCM) can list and clear Polymarket contracts.

This path is crucial because it takes Polymarket from a niche, quasi-black market website into the mainstream financial realm. This means that the familiar applications your friends use to trade stocks or ETFs could theoretically integrate these event-based bets. Brokers do not need to build entirely new infrastructure to support the popular and commonly used prediction markets in the cryptocurrency space; they simply need to connect to existing derivatives clearing and custody systems.

From user experience to backend systems, all aspects can be seamlessly connected. For users who occasionally check market dynamics (including portfolio value, yield products, and cryptocurrency quotes), binary prediction contracts may soon appear just like other trading tools. This integration of prediction markets and brokers represents a perfect combination of financial innovation and regulatory compliance.

Nevada ruling draws a red line: sports events banned

Nevertheless, not all event markets follow the same regulatory rules. Federal approval does not equate to universal acceptance. A recent ruling by a judge in Nevada has cast a shadow over prediction contracts related to sports events or athletes, even on federally regulated exchange platforms like Kalshi.

In November 2025, U.S. District Judge Andrew Gordon ruled that contracts for sports event results are not considered “swap agreements” under the federal derivative commodity law (Commodity Exchange Act). This means they are not subject to CFTC regulation but are instead governed by state gambling laws, even if these contracts are offered through exchanges designated by the CFTC. One consequence of this is that the Nevada Gaming Control Board (NGCB) has explicitly stated that, regardless of whether the platform is federally registered, sports event contracts constitute gambling activities under state law.

This disconnection divides the prediction market into two main categories

1. Legal and tradable categories through brokers

· Macroeconomic events (interest rate decisions, CPI data, unemployment rate)

· Political outcomes (elections, policy approvals, cabinet appointments)

· Financial policy betting (central bank decisions, regulatory changes, corporate profits)

2. Categories Restricted by State Gambling Laws

· Sports event results (match outcomes, score predictions)

· Special bets (athlete individual performance, specific event occurrence)

· Athlete competition results (scoring champion, MVP race)

Therefore, even if Polymarket is preparing to go back online, the content displayed in your brokerage account may largely depend on the state you are in. Nevada may completely prohibit such bets or impose many licensing requirements that prediction platforms cannot meet. This regulatory fragmentation poses complex challenges for the integration of prediction markets and brokers.

Actual Impact on General Users

You may soon scroll past “stocks”, “cryptocurrencies”, and “options”, discovering binary yes/no contracts related to macroeconomic events (such as interest rate decisions, unexpected inflation), earnings beats, and even political outcomes. These investment products differ from traditional options in that their payouts are either all or nothing (or a fixed proportion), with the maximum loss being clear (i.e., the investment amount), but the platform may charge higher commissions.

Liquidity may be poorer, especially in the early stages, and price fluctuations may be more dramatic than those of actively traded stocks or even popular options. If your state equates “sports/event contracts to gambling,” such trading instruments may face regional restrictions or complete bans. Brokers and futures commission merchants may need to implement customer due diligence/anti-money laundering (KYC/AML), suitability reviews, and comply with state-level regulations.

For the user experience of the prediction market on brokerage platforms, the following features can be expected: the interface will integrate with existing trading tools and may appear under the “Options” or “Derivatives” tab; the contract underlying will focus on macro events rather than sporting events; the pricing mechanism will adopt a binary structure, with clear risks but potentially lower liquidity than mainstream products; geographic restriction functions will automatically block restricted markets based on the user's state.

Outlook: Steady Bets and Divided States

If enough brokers integrate through the QCX/QC clearing system and maintain their focus on macroeconomic, policy, or financial events rather than sports events or special bets, this model could thrive. Election cycles, central bank decisions, regulatory dynamics, and macroeconomic turning points will naturally create demand for binary outcome betting. People want to hedge uncertainty or bet on beliefs, and binary contracts perfectly meet this demand.

However, the fragmentation of the current legal system remains an unknown. The ruling in Nevada may encourage other states to exercise greater jurisdiction over contracts related to the outcomes of sporting events. This will force platforms to design according to the restrictions of each state, impose geographical limitations on specific categories of events, or establish compliance mechanisms, rather than assuming that everyone can participate. At the same time, traditional bookmakers and sports betting companies may not easily concede. In their view, prediction markets pose competitive pressure on sports betting revenue.

For general users, especially those who do not pay much attention when logging into brokerage applications, event contracts may become a new frontier: a hybrid between market speculation and gambling. The financial market system provides structure, limits, and clearing mechanisms, while the differing regulations between states set up many barriers. Ultimately, a narrow but continuously expanding channel may form, where macro and political betting can be conducted through applications familiar to users, while more controversial sports events or special bets remain on the fringes or are prohibited.

When you click on “Market” in the brokerage app and see binary options contracts like “Will the central bank raise interest rates at the next meeting?”, it may no longer be a marginal novelty. It may be part of an expanding securities product that is influenced by federal regulations, strategic acquisitions, and changes in regulatory boundaries. The integration of prediction markets with brokers is redefining the boundaries of financial trading.