Gemini Secures Derivatives License, Set to Challenge Kalshi and Polymarket in Prediction Markets

The cryptocurrency exchange Gemini, founded by Cameron and Tyler Winklevoss, has received approval from the U.S. Commodity Futures Trading Commission (CFTC) for a derivatives clearing organization (DCO) license. This license enables Gemini to clear and settle trades internally, giving the company greater control over its prediction market products. As a result, Gemini's shares rose by approximately 7%. The approval comes at a time when prediction markets are experiencing rapid growth, with trading volumes increasing by over 300% in 2025 to $63.5 billion. Gemini is now poised to compete with established players such as Kalshi and Polymarket, as well as newcomer Hyperliquid, a DeFi derivatives platform. The company's prediction marketplace, launched via its affiliate Gemini Titan in December 2025, received a designated contract market (DCM) authorization from the CFTC. With both DCM and DCO licenses in place, Gemini is well-positioned to offer a comprehensive trading ecosystem, including sports, crypto, futures, options, and event-based contracts. The company also plans to expand into crypto futures, options, and perpetuals for U.S. users. According to Cameron Winklevoss, this development marks a significant milestone in Gemini's efforts to create a 'super app' for financial services. In February, Gemini announced its plans to focus on the U.S. market and exit the U.K., European Union, and Australia, which involved a staff reduction of around 25%. The founders believe that prediction markets have the potential to become as large as or even surpass today's capital markets.