Gemini and Coinbase Challenge CFTC’s Restrictive Market Proposal

Gemini and Coinbase have voiced strong opposition to a proposed rule from the Commodity Futures Trading Commission (CFTC) that aims to impose restrictions on prediction markets such as Polymarkets.

Unveiled in May, this proposal targets event contracts, particularly those related to political events, and has garnered support from figures like Senator Elizabeth Warren, who is concerned about potential risks from election-related betting.

In an August 8 letter, Gemini criticized the proposal as a misinterpretation of the Commodity Exchange Act (CEA), arguing that it could harm public interest by unfairly categorizing all event contracts. Co-founder Cameron Winklevoss defended prediction markets, highlighting their role in providing valuable, financially-backed forecasts.

Coinbase’s Chief Legal Officer, Paul Grewal, joined the critique, condemning the rule’s vague terms and disputing the CFTC’s claims about public harm. Both companies are calling for the withdrawal of the proposal and advocating for a collaborative approach to regulation.

The debate comes as prediction markets, particularly those focused on the 2024 U.S. presidential election, continue to gain traction. Last month, Polymarket alone saw substantial trading activity, with $387 million in volume.

Author

Alexander Stefanov

Reporter at CoinsPress

Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.