Coinbase has received a subpoena from the U.S. Commodity Futures Trading Commission (CFTC) as part of an investigation into Polymarket, a cryptocurrency-based prediction exchange platform.

The CFTC is investigating whether Polymarket has allowed U.S.-based customers to participate in its betting markets, which would violate a previous settlement agreement. In 2022, Polymarket paid a $1.4 million penalty to the CFTC for operating without proper registration and agreed to stop serving U.S. customers.

Coinbase has notified affected users about the subpoena, which requires the company to share customer account information with the CFTC. While no action is required from users, their account details may be disclosed to the federal agency.

Polymarket has faced recent criticism for controversial betting markets, including:

• Wagers on the Los Angeles wildfires that have claimed 24 lives
• Betting on the alleged gunman in the UnitedHealthcare CEO murder case
• The 2024 presidential election outcome

The platform defends its markets as providing "transparent, probabilistic forecasts" rather than speculation, and has suspended fees on wildfire-related markets.

In a separate development, Singapore's Gambling Regulatory Authority (GRA) has banned Polymarket, declaring it an illegal gambling site. Singaporean residents caught using the platform face fines up to S$10,000 and six months imprisonment.

The ongoing CFTC investigation and international regulatory challenges highlight the growing scrutiny of cryptocurrency-based prediction markets and their legal compliance obligations.

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