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In a surprising turn of events, Polymarket, the largest crypto gambling app has been hit by a probe from the UK’s Financial Conduct Authority. The company is accused of not having adequate systems to protect players with regards to their private information and money laundering risk.
A US regulator has reportedly entered into an investigation over the Polymarket crypto betting app. The move comes amid heightened scrutiny of online gambling companies, which are typically unregulated in most jurisdictions outside of New Jersey. Experts say that if legitimate concerns arise about cryptocurrency-powered games on platforms like Polymarket, regulators will likely take steps to halt any activity they deem fraudulent or illegal.
The US Commodity Futures Trading Commission (CFTC), the country’s derivatives and futures markets regulator, is rumored to be investigating cryptocurrency-based betting app Polymarket.
According to Bloomberg, the CFTC has opened an inquiry against the corporation for possibly violating US financial regulatory regulations. Polymarket is also being investigated for illegally allowing clients to exchange swaps.
Polymarket’s spokesman said that the company would adhere to the CFTC’s rules and regulations, as well as help the agency with any questions or concerns they may have. The Commodities Futures and Trading Commission, on the other hand, has refused to comment on the matter.
The social value factor
Polymarket CEO Shaun Coplan claims that the company not only allows bettors to profit, but also provides “precise predictions of events via price discovery.” This sort of data, according to Coplan, may have “tremendous societal significance.”
Polymarket is now in negotiations with possible investors for a fresh investment round, according to two anonymous persons with knowledge of the situation. This could push its market price to a staggering $1 billion. Since its initial public offering in 2020, the business has also managed the sale of 4 billion shares.
Polymarket, situated in New York, has established a sizable fan base due to its betting services, which have drawn a large number of people looking to make crypto-based bets and anticipate real-life events such as elections, celebrity private lives, and ballgames.
The company does not hold customers’ cryptocurrencies or money; instead, it just shows the current markets on the Ethereum blockchain. Polymarket included hundreds of bets based on various global events as of Friday afternoon, ranging from finance to celebrity personal lives.
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