Crypto.com is forming an internal team of quantitative traders to act as market makers on its sports prediction market, directly trading against its own users. The company is hiring a US-based quant trader with a salary starting at $120,000 annually to manage this desk. The role involves pricing, providing liquidity, and continuously quoting markets for sports event contracts, which allow users to trade on yes-or-no outcomes of real-world games.
The move has ignited significant debate over potential conflicts of interest. While Crypto.com states it does not rely on proprietary trading for revenue and that market makers do not have prior access to customer orders, its rules grant them a three-second head start over retail traders when receiving contracts. The company defends the operation as a regulatory compliance measure, with the team registered with the Commodity Futures Trading Commission (CFTC).
This practice mirrors models used by competitors like Kalshi and Polymarket, which have faced lawsuits and regulatory scrutiny. Kalshi co-founder Luana Lopes Lara has defended similar setups, arguing that market makers help bootstrap liquidity without profiting from user losses.
The hiring push comes as Crypto.com aggressively expands in the prediction market space, which has become a primary source of activity on its platform. It has secured high-profile partnerships, including a recent launch with sports apparel giant Fanatics built on Crypto.com's regulated U.S. derivatives infrastructure, following earlier collaborations with Truth Social and MyPrize.
However, the sector faces mounting legal challenges. Last week, Connecticut regulators ordered Crypto.com, Kalshi, and Robinhood to halt offering sports event contracts to state residents, arguing the products constitute unlicensed sports wagering despite federal approval pathways through the CFTC. This regulatory pressure coincides with intensified competition, highlighted by Coinbase's recent agreement to acquire prediction markets startup The Clearing Company.
