Billionaire Peter Thiel’s Founders Fund recently spearheaded the Series B funding round for Polymarket, a crypto-based prediction markets platform, raising $45 million. This latest funding round valued Polymarket at a figure below the anticipated $1 billion mark, which was influenced by the Commodity Futures Trading Commission's proposal to prohibit event betting contracts.

CFTC Proposes Crackdown on Event Betting Contracts

Polymarket, the crypto predictions platform, secured $45 million in its Series B funding round, with the Founders Fund, led by billionaire Peter Thiel, taking the helm. Despite this substantial investment, the valuation of Polymarket fell short of the expected $1 billion threshold due to the proposal by the Commodity Futures Trading Commission (CFTC) to ban derivatives trading linked to political and sports events.

Reports from Bloomberg indicate that if the proposal is greenlit, the CFTC would enforce restrictions on event betting contracts, impacting platforms like Polymarket. Known for its bets ranging from the U.S. Presidential Elections to monetary policy outcomes, Polymarket faced penalties earlier, including a $1.4 million fine and orders to shut down non-compliant markets. In January 2022, Polymarket committed to compliance, announcing the premature winding down of three markets.

In an effort to repair its relationship with regulators, Polymarket appointed former CFTC head Christopher Giancarlo as chairman of its advisory board.

Regarding the Founders Fund's decision to invest in a platform enabling event-betting contracts, Joey Krug, a partner at the venture capital firm, commented:

"Much of the resistance to prediction markets in the U.S. stems from historical attitudes towards betting. In the short to mid-term, this move benefits Polymarket as it targets international markets. However, we also hope for future participation from U.S. citizens."

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