Polymarket to Launch In-House Trading Desk That Bets Against Users: Report | Invesloan.com

Polymarket is recruiting staff for an internal market-making team that would trade against its own customers, mirroring a controversial feature already used by rival Kalshi that has drawn criticism and legal challenges.

According to Bloomberg, the New York-based prediction market startup has approached traders, including sports bettors, to join the new unit, people familiar with the matter said, requesting anonymity because the plans remain private.

Polymarket declined to comment on the recruitment effort.

The move comes as the platform prepares its full U.S. relaunch after securing regulatory clearance from the Commodity Futures Trading Commission, having paid a $1.4 million penalty in 2022 for operating an unregistered derivatives exchange.

Kalshi’s Market-Making Unit Faces Legal Scrutiny

Kalshi already operates an in-house trading arm, Kalshi Trading, which places bids on the exchange and effectively takes opposing positions to customers’ bets.

Company executives have defended the unit as necessary to create liquidity and improve the user experience.

Still, critics argue it creates inherent conflicts of interest and makes Kalshi resemble a traditional sportsbook rather than a neutral peer-to-peer platform.

Some are now claiming that the company is a gambling company and not a prediction company.

“Let’s just call a spade a spade, it’s gambling, lots of things are gambling,” a X user said.

A proposed class action lawsuit filed last month alleges that Kalshi Trading sets betting lines that disadvantage customers, claiming “consumers place bets on Kalshi, they face off against money provided by a sophisticated market maker on the other side of the ledger.“

Kalshi co-founder Luana Lopes Lara dismissed the lawsuit as a “pure smear campaign” on social media.

She stated that Kalshi Trading operates unprofitably and receives “no preferential access or treatment.”

However, the legal challenge shows mounting concerns about whether prediction markets function as advertised, neutral platforms where users with differing opinions trade directly with each other.

Push for Market-Making Comes Amid Rapid U.S. Expansion

Polymarket’s decision to build an internal trading desk arrives as the company executes its return to American markets following years offshore.

In December, the CFTC issued a no-action letter covering QCX LLC and QC Clearing LLC, two entities Polymarket acquired earlier in 2025 for $112 million to gain licensed designated contract market status and regulated clearing capabilities.

The agency granted temporary relief from certain swap data reporting requirements, allowing the platform to operate within the same framework governing federally supervised U.S. trading venues.

Founder and CEO Shayne Coplan confirmed receiving “the green light to go live in the USA” and credited CFTC staff for completing the process in record time.

The regulatory clearance caps a lengthy journey that intensified in November 2024 when the FBI raided Coplan’s Manhattan residence and seized electronic devices as part of an investigation into whether Americans continued accessing the site through VPNs despite the 2022 ban.

Despite being barred from U.S. operations since 2022, Polymarket expanded aggressively overseas, recording roughly $6 billion in wagers during the first half of 2025 alone.

The platform gained global attention during the 2024 presidential election cycle, as its markets closely tracked Donald Trump’s odds of winning.

Market Makers and Growing Institutional Interest

Prediction markets rely heavily on market makers willing to take less popular trades, as the platforms match buyers with sellers on binary yes-or-no contracts.

Both Polymarket and Kalshi have offered incentives rewarding heavy users who provide liquidity, while a small number of traditional financial trading firms, including Susquehanna International Group and Jump Trading, have begun serving as external market makers on Kalshi.

Mike Novogratz’s Galaxy Digital is currently in talks with both platforms to become a liquidity provider, with Novogratz telling Bloomberg that the firm is “doing some small-scale experimenting with market-making on prediction markets.“

The broader debate centers on whether prediction markets genuinely differ from traditional gambling operations.

During a public appearance last month, Coplan called conventional sportsbooks a “scam” that “rip off the consumer,” positioning Polymarket as a transparent alternative where users trade against each other rather than facing house odds designed to extract profits.

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