Polymarket’s Bold Move: In-House Trading Desk Bets Against Its Own Users
Polymarket isn't just hosting the bets anymore—it's placing them. The prediction market platform is reportedly building an internal trading desk designed to take the opposite side of user positions. That's right: the house wants to play.
A New Kind of Market Maker
Forget neutral facilitation. This move transforms Polymarket from a simple platform into an active participant with skin in the game. The in-house desk would analyze user sentiment and liquidity, then strategically wager against the crowd. It's a classic 'the house always wins' model, but digitized for the crypto age.
Liquidity vs. Conflict
Proponents argue this could solve prediction markets' eternal liquidity problem. A deep-pocketed internal desk can ensure there's always a counterparty, making markets more efficient. Critics see a glaring conflict of interest—a platform potentially profiting directly from its users' losses, a dynamic that would make even a traditional bookmaker blush.
The Regulatory Tightrope
The maneuver walks a fine line in a regulatory gray zone. While decentralized in spirit, an active trading arm invites scrutiny about market manipulation and fairness. It's a gamble that could either cement Polymarket's dominance or attract the kind of attention that crashes the party.
Polymarket's play is a stark reminder: in the world of speculative finance, whether it's Wall Street or a blockchain, someone always designs the game to come out ahead. The only question is whether the players at the table realize they're also on the menu.
Kalshi’s Market-Making Unit Faces Legal Scrutiny
Kalshi already operates an in-house trading arm, Kalshi Trading, which places bids on the exchange and effectively takes opposing positions to customers’ bets.
Company executives have defended the unit as necessary to create liquidity and improve the user experience.
Still, critics argue it creates inherent conflicts of interest and makes Kalshi resemble a traditional sportsbook rather than a neutral peer-to-peer platform.
Some are now claiming that the company is a gambling company and not a prediction company.
“Let’s just call a spade a spade, it’s gambling, lots of things are gambling,” a X user said.
it has been decided by the courts
https://t.co/lU0S6XWrkA
A proposed class action lawsuit filed last month alleges that Kalshi Trading sets betting lines that disadvantage customers, claiming “consumers place bets on Kalshi, they face off against money provided by a sophisticated market Maker on the other side of the ledger.“
Kalshi co-founder Luana Lopes Lara dismissed the lawsuit as a “pure smear campaign” on social media.
She stated that Kalshi Trading operates unprofitably and receives “no preferential access or treatment.”
However, the legal challenge shows mounting concerns about whether prediction markets function as advertised, neutral platforms where users with differing opinions trade directly with each other.
1. Rebrand gambling as asset allocation
2. Rebrand sportsbook as truth engine
3. Rebrand bets as predictions
4. Spin up in-house market maker to c̶o̶m̶p̶e̶t̶e̶ collaborate with c̶u̶s̶t̶o̶m̶e̶r̶s̶ fellow investors for the greater good
It's really noble if you think about it. https://t.co/UQx67fg3DI
Push for Market-Making Comes Amid Rapid U.S. Expansion
Polymarket’s decision to build an internal trading desk arrives as the company executes its return to American markets following years offshore.
In December, the CFTC issued a no-action letter covering QCX LLC and QC Clearing LLC, two entities Polymarket acquired earlier in 2025 for $112 million to gain licensed designated contract market status and regulated clearing capabilities.
The agency granted temporary relief from certain swap data reporting requirements, allowing the platform to operate within the same framework governing federally supervised U.S. trading venues.
Prediction market platform Polymarket says it has received an Amended Order of Designation from the CFTC.#Crypto #CFTChttps://t.co/H44tIIxPaz
Founder and CEO Shayne Coplan confirmed receiving “the green light to go live in the USA” and credited CFTC staff for completing the process in record time.
The regulatory clearance caps a lengthy journey that intensified in November 2024 when the FBI raided Coplan’s Manhattan residence and seized electronic devices as part of an investigation into whether Americans continued accessing the site through VPNs despite the 2022 ban.
Despite being barred from U.S. operations since 2022, Polymarket expanded aggressively overseas, recording roughly $6 billion in wagers during the first half of 2025 alone.
The platform gained global attention during the 2024 presidential election cycle, as its markets closely tracked Donald Trump’s odds of winning.
Market Makers and Growing Institutional Interest
Prediction markets rely heavily on market makers willing to take less popular trades, as the platforms match buyers with sellers on binary yes-or-no contracts.
Both Polymarket and Kalshi have offered incentives rewarding heavy users who provide liquidity, while a small number of traditional financial trading firms, including Susquehanna International Group and Jump Trading, have begun serving as external market makers on Kalshi.
@GalaxyDigital is in talks to provide liquidity on Polymarket and Kalshi, reflecting the growing momentum of prediction markets among retail traders and Wall Street.#PredictionMarkets #Galaxy https://t.co/2wgytQSkZ4
Mike Novogratz’s Galaxy Digital is currently in talks with both platforms to become a liquidity provider, with Novogratz telling Bloomberg that the firm is “doing some small-scale experimenting with market-making on prediction markets.“
The broader debate centers on whether prediction markets genuinely differ from traditional gambling operations.
During a public appearance last month, Coplan called conventional sportsbooks a “” that “” positioning Polymarket as a transparent alternative where users trade against each other rather than facing house odds designed to extract profits.
