The Commodity Futures Trading Commission (CFTC) has issued a new subpoena to the cryptocurrency exchange Coinbase in relation to the Polymarket case. This development comes just days before President Joe Biden's term concludes.
CFTC's Request to Coinbase
As Biden's administration nears completion, the spotlight is on the CFTC's decision to subpoena Coinbase in the Polymarket case. Eric, a co-author of Ethereum’s EIP-1559, shared information received from the exchange publicly. Coinbase has informed its customers via email that they may need to share account-related information with the CFTC, though it has stated that no immediate action is required from customers at this time.
Transition Period and New Administration
This move indicates that Coinbase must comply with the CFTC's request if it does not reject it or submit another legal document by the end of the business day on January 15, 2025. This announcement came ahead of CFTC Chairman Rostin Behnam's departure, with President-elect Donald Trump set to take office on January 20. Trump's transition team evaluated at least six candidates to manage the CFTC, and the new administration seems aligned with promises to create a more cryptocurrency-friendly regulatory framework.
Polymarket and Regulatory Scrutiny
Polymarket, a decentralized prediction market platform, gained significant popularity during the 2024 U.S. presidential elections, capturing the attention of regulators like the CFTC. The CFTC has sought to limit operations of prediction markets, labeling these platforms as gambling entities. Despite Vice President Kamala Harris’s promises regarding cryptocurrency, Democrats have continued to apply pressure on the sector during the final days of the administration. While Coinbase and the CFTC have not publicly commented on the matter, the subpoena is seen as a crucial point in the interaction between U.S. regulatory oversight and the cryptocurrency industry.
These developments illustrate the stringent stance of the U.S. on cryptocurrency regulations and how these policies can shift during transition periods. Although Coinbase has informed its customers, the company currently does not anticipate any immediate action. The cryptocurrency policies of the incoming administration could be pivotal for the industry players.
