- Polymarket has applied for a Futures Commission Merchant (FCM) license to expand its regulated presence in the United States.
- The company wants to introduce leveraged prediction markets, but still needs CFTC approval before launching margin trading.
- If approved, Polymarket would compete more directly with rival Kalshi in the growing regulated prediction market industry.
Polymarket is moving closer to expanding its footprint in the United States after applying for a Futures Commission Merchant (FCM) license. The application represents another major step in the company’s effort to operate within the country’s regulated financial system while bringing more advanced trading features to its prediction market platform.
If regulators approve the application, eligible users could eventually trade event contracts using leverage instead of fully collateralizing every position, making Polymarket’s platform more similar to traditional futures markets.
Polymarket Applies for an FCM License
According to regulatory filings, Polymarket submitted its FCM application on July 3 through its affiliate, Coming Home GBA LLC.
An FCM license allows firms to act as intermediaries between customers and regulated derivatives markets by handling client funds, processing trades, and managing margin requirements.
Receiving the license would significantly strengthen Polymarket’s regulatory standing as it continues working to re-establish and expand its presence in the U.S. market.
CFTC Approval Remains the Biggest Hurdle
Although obtaining an FCM license would be an important milestone, it is only one part of the approval process.
Before Polymarket can introduce leveraged prediction contracts, the company must also receive approval from the Commodity Futures Trading Commission (CFTC) to amend its rulebook. That approval would allow traders to open positions without fully funding every contract upfront.
If margin trading is eventually approved, users would also be subject to stricter identity verification requirements, including providing additional personal and employment information under existing U.S. regulations.
Why Margin Trading Matters
Margin trading allows investors to control larger positions while committing only a portion of the required capital. The remaining value is effectively financed through leverage, increasing both potential profits and potential losses.
The model is widely used throughout traditional futures and derivatives markets because it improves capital efficiency and enables professional traders to manage multiple positions simultaneously.
For Polymarket, adding margin trading could make the platform significantly more attractive to institutional investors and experienced derivatives traders seeking regulated prediction market exposure.
Competition With Kalshi Continues to Grow
Polymarket’s regulatory push comes as competition with Kalshi continues intensifying.
Earlier this year, Kalshi secured its own FCM license through affiliate Kinetic Markets LLC, giving it an early advantage in building regulated brokerage services for event contracts.
If Polymarket ultimately secures both its FCM license and CFTC approval for leveraged contracts, the platform would be positioned to compete more directly with Kalshi as prediction markets continue expanding into areas such as cryptocurrencies, macroeconomics, sports, elections, and corporate events.
As regulatory oversight increases, both companies are seeking to position prediction markets as legitimate financial products rather than speculative wagering platforms, a shift that could significantly shape the industry’s future.
