Gemini urges the CFTC to withdraw a rule that could ban event contracts on prediction markets like Polymarket, citing transparency concerns.
Coinbase opposes the CFTC proposal, arguing it overlooks public benefits of prediction markets and calls for a more balanced regulatory approach.
U.S. lawmakers push for a ban on betting on the 2024 presidential election, fearing it could erode public trust in democracy.
Cryptocurrency exchange Gemini has urged United States regulators to reconsider a proposed rule that could ban all event contracts on decentralized prediction markets.
https://twitter.com/cameron/status/1822119376482685020
The exchange emphasized the significant impact this regulation could have on prediction platforms, particularly those used for forecasting elections. Gemini raised its concerns in a letter to Christopher Kirkpatrick who is the secretary of the U.S. Commodity Futures Trading Commission.
Transparency in Prediction Markets
Cameron Winklevoss also addressed the matter on social media, emphasizing the openness that prediction platforms like Polymarket provide their consumers. Winklevoss explained that these platforms demand users to make financial commitments, which he believes adds a level of honesty not found in other forecasting methodologies. He argued that the CFTC should withdraw its proposed rule, as it could severely affect platforms like Polymarket, currently the largest prediction market globally.
Coinbase Joins the Opposition
Coinbase has also voiced its objections to the proposed regulation. Paul Grewal stated that the proposal overlooks the public benefits that prediction markets provide. He urged the CFTC to work with academic, industry, and policy stakeholders to develop a more balanced approach. According to Grewal, such collaboration could help promote innovation while still protecting public interest.
Lawmakers Renew Calls for Ban
The discussion over the proposed legislation heated up as numerous US legislators reiterated their call for the CFTC to prohibit betting on the 2024 presidential election. These senators raised fears that such markets could sway election results and undermine public trust in democracy. On August 5, they issued a letter to CFTC Chair Rostin Benham urging her to restrict contracts for election-related events.
As the CFTC considers the proposed rule, the argument illustrates the continuous conflict between encouraging innovation in the cryptocurrency sector and protecting public faith in democratic institutions.
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