- Gemini emphasized the negative effects that this regulation would have on prediction markets.
- Another entity that voiced its disapproval of the regulation was crypto exchange Coinbase.
Gemini, a cryptocurrency exchange, has asked US authorities to shelve a proposal that would outlaw event contracts on decentralized prediction markets if it were to pass.
In a letter sent to Christopher Kirkpatrick, secretary of the US Commodity Futures Trading Commission (CFTC), on August 8, Gemini emphasized the negative effects that this regulation would have on prediction markets, particularly those that predict elections.
Move to Outlaw All Event Contracts
Cameron Winklevoss, co-founder of Gemini, expanded on his social media remarks on the significance of crypto prediction platforms like Polymarket, highlighting the transparency they provide to users.
Winklevoss said in an August 9th X post that the CFTC ought to rescind its Proposed Rule on event contracts. This rule would effectively outlaw all event contracts in the United States, including those traded on Polymarket, the biggest prediction market in the world.
Participants are required to have “skin in the game,” or put their money where their mouth is, in contrast to surveys, pundits, or expert judgments, according to Winklevoss. Platforms like Polymarket, he said, provide an extra layer of security because of their proof-of-stake requirement.
Another entity that voiced its disapproval of the regulation was crypto exchange Coinbase. The proposal, according to Coinbase’s chief legal officer Paul Grewal, ignores the public advantages of prediction markets.
In a letter to the CFTC, Grewal urged the organization to shelve the plan and instead collaborate with those in academia, business, and government to find a middle ground that would allow innovation to flourish while safeguarding the public interest.
Following the reiteration of demands by five senators and three representatives to prohibit betting on the 2024 presidential election, this comes as no surprise. They wrote to the chair of the CFTC, Rostin Behnam, on August 5, claiming that these markets might affect and disrupt elections and further damage public faith in democracy.
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