JPMorgan has closed Polymarket's bank accounts citing regulatory concerns, but the bank remains interested in underwriting a future IPO as the prediction market platform faces legal and compliance challenges in the U.S.
JPMorgan Chase has ended its banking relationship with Polymarket, the blockchain-based prediction market, instructing the company to move its accounts to another financial institution in October 2025, according to a report from The Financial Times. The decision, confirmed by Reuters, was attributed to regulatory concerns, though neither outlet reported that U.S. authorities directly ordered or pressured JPMorgan to take action. Polymarket has since transitioned its accounts to a different, undisclosed lender.
Banking Exit, Ongoing Ties
Despite closing Polymarket's accounts, JPMorgan has not fully severed business ties. The bank is positioning itself to underwrite a potential initial public offering (IPO) for Polymarket if the company moves forward with listing. Polymarket's CEO, Shayne Coplan, was also invited to speak at a JPMorgan private client event in Miami in February 2026, sharing the stage with former NFL quarterback Tom Brady. According to Polymarket, the company continues to work with JPMorgan across multiple business areas, including operational integrations and customer fund flows.
Regulatory and Legal Pressures
At the time of the account closure, Polymarket was barred from serving U.S. customers due to a 2022 Commodity Futures Trading Commission (CFTC) settlement that required the company to pay a $1.4 million penalty and shut down non-compliant markets. Polymarket later re-entered the U.S. market by acquiring QCX LLC, a derivatives exchange, and QC Clearing LLC, a clearinghouse, for $112 million. The CFTC designated QCX as a contract market in July 2025 and expanded that designation in November to allow intermediated trading. Legal scrutiny remains high: in August 2026, Baltimore filed a lawsuit against both Kalshi and Polymarket over sports-related contracts, while a Washington state court ordered Kalshi to suspend most offerings in that state. The New York City Council also launched an investigation into the marketing practices of Polymarket, Kalshi, Coinbase, and Gemini Titan.
Growth, Funding, and Market Context
Polymarket is reportedly in early talks to raise approximately $1 billion at a valuation exceeding $20 billion, according to Reuters. The company's last confirmed valuation was $9 billion in October 2025, following a commitment from Intercontinental Exchange to invest up to $2 billion. In July 2026, Polymarket and its U.S. platform reported a combined trading volume of $12.9 billion, while competitor Kalshi recorded $40 billion over the same period, based on data from The Block. The pattern of account closures by JPMorgan is not unique to Polymarket; the bank also closed accounts belonging to Strike CEO Jack Mallers and a ShapeShift executive in November 2025, citing regulatory risk without further explanation. JPMorgan CEO Jamie Dimon has publicly acknowledged that banks face significant penalties if crypto clients later trigger regulatory issues, which limits transparency around such decisions.
Broader Regulatory Environment
In August 2025, then-President Trump signed an executive order directing regulators to investigate cases of debanking and impose fines if improper pressure is found. Polymarket's CEO, Shayne Coplan, is a member of the CFTC's Innovation Advisory Committee, which is scheduled to meet for the first time on August 20, 2026. Trump is also expected to meet with crypto and prediction market executives at the White House on August 19. The regulatory environment for crypto companies remains fluid, with enforcement actions, lawsuits, and compliance requirements shaping how banks and platforms interact. For context, the issue of regulatory scrutiny and transparency in crypto banking relationships has also been highlighted in recent coverage of stablecoin issuers, such as when Tether completed its first full independent audit confirming its reserves.
In July 2026, Polymarket and its U.S. platform reported a combined trading volume of $12.9 billion, while Kalshi's volume reached $40 billion for the same period, according to The Block. Polymarket's last confirmed valuation was $9 billion in October 2025, with Intercontinental Exchange pledging up to $2 billion in investment. The company is now reportedly seeking to raise an additional $1 billion at a valuation above $20 billion, reflecting continued investor interest despite ongoing regulatory and legal challenges.
Prediction markets like Polymarket operate at the intersection of blockchain technology, derivatives regulation, and financial services. These platforms allow users to trade on the outcome of future events, but their legal status in the U.S. depends on compliance with CFTC rules and state-level gambling and derivatives laws. As regulatory scrutiny intensifies, banks and service providers face heightened risk when working with crypto clients, often resulting in abrupt changes to business relationships. For users and companies, this environment creates uncertainty around access to banking, trading, and investment services, underscoring the importance of understanding both the technical and legal frameworks that govern digital asset markets.
