JPMorgan Cuts Banking Ties With Polymarket Over Regulatory Concerns

Back in the fall of 2025, JPMorgan Chase told Polymarket it would need to find a new banking partner. The Financial Times reported the move, citing its own sources. The stated reason involved regulatory risks tied to prediction markets, though the relationship between the two firms did not fully end.

What exactly happened?

In October 2025, JPMorgan closed the accounts Polymarket used to settle payments with US users. The bank made no public statement about it and simply gave the company a few months to find an alternative. According to the Financial Times, Polymarket has already moved to a new lender, though neither the platform nor the report's sources disclosed the name.

Polymarket's press office said the company still maintains a "close, active relationship" with JPMorgan. That phrasing looks somewhat odd given the closed accounts, and this gap is exactly what caught reporters' attention. The bank appears to have split the partnership into an allowed part and an unwanted one: the client dialogue stayed, while the direct payment accounts disappeared. CoinDesk and Cointelegraph both reached out to the two companies for comment, with no response so far.

Why do banks avoid prediction markets in the first place?

Prediction markets like Polymarket let users bet on the outcome of events, from elections to Bitcoin price swings. For banks, that's legally uncertain ground: some regulators treat such contracts as derivatives, others equate them with gambling. Serving a company whose status isn't settled carries real risk for any federally licensed US bank.

Back in 2022, the Commodity Futures Trading Commission fined Polymarket $1.4 million for running an unregistered derivatives exchange and barred it from serving US users. The platform only returned to the American market in late 2025, after the Trump administration eased federal rules for this type of product. That fine history explains why banks stay cautious even after the company's formal return to a legal market.

Rival platform Kalshi faces similar pressure. Several states have sued prediction markets over gambling law violations. For a bank's legal team, avoiding direct settlement accounts is simply easier than untangling every individual lawsuit across that patchwork of rules.

How does the platform operate without a direct bank account?

The formal break with JPMorgan hasn't stopped Polymarket's US operations. The company already had experience building infrastructure without access to major American banks, dating back to the 2022 ban, so the switch to a new partner happened fairly quickly and without visible disruption to user payouts.

• New partner: the platform now works with a different lender whose name the Financial Times did not disclose.
• User settlements mostly run through the USDC stablecoin, which cuts the need for a direct dollar account on every transaction.
• Part of the operational infrastructure still sits outside the traditional banking system, much like during the 2022-2025 ban.
• The company publicly insists the JPMorgan relationship isn't fully severed, just reshaped.

Why doesn't JPMorgan cut ties completely?

The most interesting part of the story is that the bank kept other channels open despite the formal account closure. In February 2026, JPMorgan invited Polymarket CEO Shayne Coplan to speak at a private client conference. That's not a gesture a bank makes toward a partner it genuinely wants nothing to do with.

Financial Times sources also say the bank is weighing an underwriting role if the platform ever goes public. In other words, this isn't a boycott. It's risk management split across two different tracks. JPMorgan has long offered custody services for Bitcoin ETFs and derivatives tied to Bitcoin, yet it avoids direct settlement accounts for platforms straddling the line between a derivatives exchange and gambling.

What does this mean for the prediction market industry?

The JPMorgan precedent shows that even the largest banks are willing to maintain indirect ties with companies like Polymarket while keeping official distance from operating accounts. It's a pragmatic compromise between appetite for new business and fear of regulators.

For the industry, it's a signal: banking access remains a bottleneck even for platforms handling billions in trading volume. The next test will be whether regulators let Polymarket go public, and whether JPMorgan agrees to underwrite that listing. Until then, the company will keep balancing the formal absence of a JPMorgan banking relationship against the bank's own willingness to talk about a shared future at public events.