Binance.US targets prediction markets with CFTC license bid: report

Binance.US has moved closer to entering the U.S. prediction market business after confirming plans to seek a federal license that would let it offer regulated event contracts to retail customers.

According to Journalist Eleanor Terret, citing comments from Binance.US Chief Executive Officer Stephen Gregory at the Rare Evo conference in Las Vegas, reported that the exchange plans to apply for a Commodity Futures Trading Commission-designated contract market (DCM) license in August. 

If approved, the license would allow Binance.US to list futures, options and event-based contracts under CFTC oversight, adding a new business line beyond its existing spot cryptocurrency services. 

The application also moves forward a strategy Gregory outlined earlier this month, when he said the exchange intended to pursue licenses for derivatives, perpetual futures and prediction markets as part of its expansion plans.

Binance.US moves ahead with prediction market plans

A designated contract market license would place Binance.US alongside a small but expanding group of federally regulated prediction market operators.

Kalshi and Polymarket US already operate in the segment, while Gemini secured its own CFTC license earlier this year. Coinbase has also entered the market through a partnership with Kalshi that offers event contracts to U.S. users.

Competition continues to grow outside the crypto-native exchanges as well. The Wall Street Journal reported last week that Robinhood has discussed adding prediction market contracts from Crypto.com to its brokerage platform, extending the list of financial companies exploring the product category.

The latest move also builds on Binance.US’ recovery strategy. Gregory told earlier this month that the company wanted to regain the roughly 20% share of the U.S. crypto exchange market it once held before regulatory challenges reduced its business. Alongside lower trading fees and renewed liquidity efforts, he identified prediction markets and derivatives as products that could create additional revenue streams, subject to regulatory approvals.

Event contracts have attracted major trading platforms

Interest in prediction markets has accelerated as several companies look beyond traditional crypto trading.

Robinhood’s latest quarterly earnings illustrate that trend. The brokerage reported $156 million in revenue from event contracts during the second quarter, more than 10 times the level recorded a year earlier. According to the company’s earnings release, customers traded more than 13.6 billion event contracts during the quarter, making the category its fastest-growing source of transaction-based revenue.

While Robinhood’s cryptocurrency transaction revenue fell 38% year over year, event contracts, options and equities helped lift total quarterly revenue to a record $1.31 billion.

For Binance.US, the expansion could complement its existing business as the exchange continues rebuilding after several years of regulatory setbacks. Gregory previously said the company had already restored U.S. dollar banking services in most supported states and was working to attract customers back through lower trading costs and stronger liquidity.

CFTC approval may not end legal uncertainty

Federal approval, however, would not remove every legal hurdle facing prediction market operators.

Multiple states continue arguing that sports-related event contracts fall under state gambling laws even when platforms operate under federal commodities regulation.

The legal disagreement intensified this week after a federal judge in Wisconsin rejected the CFTC’s request to stop the state from enforcing its gambling laws against platforms including Kalshi, Polymarket, Crypto.com, Robinhood and Coinbase. Judge William Griesbach ruled that the agency had not demonstrated that sports event contracts qualify as swaps under the Commodity Exchange Act for purposes of obtaining a preliminary injunction.

The court also concluded that Wisconsin’s gambling laws were not preempted by federal commodities regulations, allowing the state’s enforcement effort to continue while litigation proceeds. The CFTC has said it will appeal the decision.

Elsewhere, federal courts have reached different conclusions. Minnesota temporarily blocked enforcement of its prediction market ban, while courts in New York, Michigan and Washington have issued rulings that favored state enforcement in separate disputes. The conflicting outcomes have left operators without a consistent legal standard across the country.

Rule changes remain under review

At the regulatory level, the CFTC is still reviewing proposed amendments to Rule 40.11, which would establish a formal process for evaluating event contracts tied to gaming, war, terrorism, assassination and unlawful activity.

The proposal has drawn comments from exchanges, legal experts, sports organizations and state governments. Earlier this week, attorneys general from 44 states urged the Commission to withdraw and rewrite the proposal, arguing that it extends beyond the authority granted under the Commodity Exchange Act and enters an area traditionally regulated by states.

The National Football League has also called for tighter safeguards on sports prediction markets, including stronger integrity protections and longer regulatory review periods before new contracts become effective. By contrast, the National Hockey League and Major League Baseball have entered commercial partnerships with prediction market platforms.

Separately, the CFTC’s Division of Market Oversight reminded designated contract markets that new event contracts should be submitted with contract-specific legal analysis and settlement details rather than through broad template certifications.