Smarkets, founded in 2008, is making its way into the U.S. by pursuing two separate avenues. The company, which has over $60 billion in lifetime trading volume, first filed for a license with the Commodity Futures Trading Commission (CFTC) in March.
According to Smarkets' founder Jason Trost, the company also has pending applications to operate as a sportsbook in Illinois, Iowa, and Michigan:
"The reason we're doing the dual track is because the legal situation is unclear if the CFTC has federal preemption or not," Trost said.
A growing number of states have argued that prediction markets are operating as illegal gambling platforms. However, the CFTC has hit back, suing multiple states.
Smarkets already operates as a sportsbook in Indiana.
"Some of my competitors are in danger of ruining the reputation of this industry because I think they're acting irresponsibly [and] not following regulation closely enough," said Jason Trost.
Smarkets prefers to operate as a prediction markets exchange regulated under the CFTC.
