Gemini, the cryptocurrency exchange founded by Tyler and Cameron Winklevoss, is preparing to launch prediction market contracts regulated by the U.S. Commodity Futures Trading Commission (CFTC), according to sources familiar with the matter. This initiative marks Gemini's latest effort to diversify beyond crypto trading into event-based financial products, such as contracts on sports, politics, and economic outcomes.
The exchange filed an application with the CFTC in May to establish a derivatives exchange designated as a contract market, which would enable users to trade these prediction contracts. However, progress has been slowed by the ongoing U.S. government shutdown, potentially delaying new regulatory reviews. If approved, Gemini would compete directly with established players like Kalshi, which already operates under a CFTC license, and Polymarket, which is seeking full reentry into the U.S. market.
This development follows Gemini's initial public offering in September, where the company outlined plans to enter financial forecasting to attract new retail and institutional users. Despite its stock trading roughly 40% below its debut price, analysts see prediction markets as a key growth driver post-IPO. The move aligns with a broader industry trend, as rivals like Coinbase have also signaled intentions to launch event contracts under their "Everything Exchange" strategies, and traditional firms such as CME Group and Intercontinental Exchange are exploring similar offerings.
Gemini's reputation for compliance, bolstered by its New York BitLicense, could provide an advantage in a sector facing regulatory ambiguity. Notably, prediction markets encounter challenges, including opposition from state gaming regulators, as seen with Kalshi's court disputes.
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