Blockchain.com Pursues CFTC Licenses to Launch Futures Exchange for Prediction Markets

Blockchain.com wants in. The company has filed applications with the US Commodity Futures Trading Commission for two separate licenses — a Designated Contract Market and a Futures Commission Merchant designation — that would let it run a futures exchange for event contracts and act as a broker for derivatives. Both retail and institutional US investors are in the crosshairs.

The DCM license is the big one. It’s what you need to legally operate a futures exchange in the United States, and without it, any prediction market ambitions basically stall at the border. The FCM piece handles the brokerage side — clearing, margin, the whole infrastructure that institutional money demands before it’ll touch a new venue. Getting both approved would put Blockchain.com in a genuinely different category from most crypto-native platforms currently operating in this space. Not a small ask, especially right now.

The Polymarket Connection

Back in July, Blockchain.com announced a collaboration with Polymarket to fold prediction markets into its platform. The partnership made sense on paper — Polymarket had the brand and the liquidity, Blockchain.com had the regulatory appetite and the existing user base. But the CFTC filing pushes things further. If the licenses come through, the company reportedly wants to build its own independent marketplace for event contracts, separate from the Polymarket arrangement. Whether that creates tension with the earlier deal isn’t clear yet. No details on that front.

It’s worth noting that prediction markets are having a rough legal moment in the US. Kalshi and Polymarket are both fighting state-level lawsuits over alleged violations of laws around betting on elections and sports. New Jersey officials have already petitioned the US Supreme Court to step into their fight against Kalshi — a move that could set a precedent that ripples across every platform in the space, including any future Blockchain.com marketplace. The federal-versus-state jurisdictional question is pretty much the core issue, and it’s nowhere near resolved.

Selig’s CFTC and the Empty Seats Problem

CFTC Chair Michael Selig has been vocal about where the agency stands. He’s pushed a proactive line on crypto regulation, pointing to the FTX collapse as the clearest argument for tighter rules on crypto spot markets. FTX’s implosion — which ended in bankruptcy and criminal charges against executives including former CEO Sam Bankman-Fried — is basically the cautionary tale Selig keeps reaching for when justifying new rulemaking.

But Selig has a real operational problem. Four commissioner seats at the CFTC are currently vacant. He’s essentially running the agency alone, which makes it harder to push through comprehensive rule changes at speed. He’s said he’s committed to the crypto agenda set by former President Donald Trump, and he’s maintained that the CFTC holds exclusive jurisdiction over prediction markets — a position that puts the agency directly at odds with states like New Jersey that want to regulate or block these platforms themselves.

Related: Blockchain.com Seeks FCM and DCM Licenses for Direct U.S. Derivatives Access

Four empty seats. One chair. That’s a thin bench for an agency trying to reshape how the US handles crypto oversight.

The broader stakes here are real. FTX’s collapse in 2022 wiped out billions and left regulators scrambling to explain why nobody caught it sooner. The CFTC’s push for new safeguards on crypto spot markets is partly a response to that embarrassment — an attempt to build a framework that can actually catch the next one before it blows up. Whether Selig can get there with a skeleton crew is another question.

The IPO Speculation

Blockchain.com’s regulatory push doesn’t exist in isolation. Reports suggest the company is eyeing an initial public offering, with a target valuation of up to $6 billion and hopes of raising $500 million. That’s a serious number. It’s also still speculative — the company hasn’t confirmed a timeline, and the regulatory uncertainty hanging over prediction markets and crypto derivatives broadly makes any IPO calculus complicated.

A successful CFTC approval would probably strengthen the IPO story considerably. Licenses are hard to get and slow to come. Holding both a DCM and an FCM designation would be a concrete differentiator in a market where most platforms are still operating in legal gray zones or under temporary exemptions.

Read also: Trumps $215M Quantum Genesis Q Competition Raises Stakes for Crypto Security

And if the Supreme Court takes up the New Jersey-Kalshi case, the entire prediction market landscape could shift — fast. A ruling in favor of federal jurisdiction would clear a lot of air for platforms like Blockchain.com. A ruling the other way could make those CFTC licenses far less useful than they look today.

Blockchain.com is reportedly targeting a $6 billion valuation in its potential public offering, with hopes to raise $500 million.