Gemini Gets Green Light for US Prediction Markets After Five-Year Wait
The CFTC approved the exchange's affiliate, Gemini Titan, to operate as a Designated Contract Market on Wednesday.
Quick overview
- Gemini received CFTC approval for its affiliate, Gemini Titan, to operate as a Designated Contract Market, allowing it to offer prediction markets to US customers.
- The Winklevoss twins praised the approval, attributing it to a shift in the political climate and expressing optimism about the growth potential of prediction markets.
- Gemini plans to expand its offerings beyond event contracts to include crypto futures, options, and perpetual contracts for US traders.
- Despite the positive news, some states are challenging the legality of event contracts, highlighting ongoing regulatory complexities in the crypto space.
Gemini just cleared a major regulatory hurdle. The CFTC approved the exchange’s affiliate, Gemini Titan, to operate as a Designated Contract Market on Wednesday, ending a licensing process that started back in March 2020.
The approval lets Gemini offer prediction markets to US customers. Basically yes-or-no bets on actual events. Can Bitcoin reach $200,000 before 2026? Does Elon pay that EU fine or not? Users can trade these contracts through Gemini’s web platform using existing USD balances, with mobile access coming later.
Tyler Winklevoss credited the Trump administration for what he called ending the “war on crypto” under Biden. His brother Cameron went further, saying prediction markets could grow bigger than traditional capital markets and praising Acting CFTC Chair Caroline Pham for taking a pro-business stance.
The political angle matters here. The Winklevoss twins, both Trump donors, reportedly helped tank Brian Quintenz’s nomination for CFTC chair. Quintenz happens to be a Kalshi director and shareholder. After lobbying from the brothers, the White House pulled his nomination and went with Michael Selig instead.
Gemini now joins Kalshi as a CFTC-regulated prediction market. Polymarket got clearance last month to return to US operations after getting kicked offshore in 2022 with a $1.4 million fine. The space is heating up fast. Analysts estimate the prediction market industry could hit $95 billion by 2035, growing at 46% annually.
Gemini’s plans go beyond simple event contracts. The company wants to explore crypto futures, options, and perpetual contracts for US customers. Perps dominate global crypto derivatives trading but remain restricted domestically. Getting approval for those would be huge for US traders who currently use offshore exchanges.
The stock liked the news. Gemini shares jumped 13.7% in after-hours trading to $12.92, though they’re still down 70% from the IPO price. That tells you how rough things have been for publicly traded crypto companies lately.
Some states aren’t playing along. Connecticut recently ordered Robinhood, Crypto.com, and Kalshi to stop offering event contracts, calling them unlicensed sports betting. Massachusetts sued Kalshi over the same issue. Federal approval doesn’t solve the state-level gambling law problems.
Gemini sees this as building toward a “one-stop financial super app.” The exchange already handles trading, custody, staking, and tokenization. Adding prediction markets and potentially derivatives creates more reasons for users to park assets there instead of spreading them across multiple platforms.
The five-year wait reflects how slowly crypto regulation moves in the US. Gemini applied when the regulatory environment was completely different. With Trump in office and new people running the CFTC, the approval went through. Whether this keeps going depends entirely on politics over the next couple years.
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