Polymarket Launches Five-Minute Markets Under CFTC Oversight
The platform uses CF Benchmarks indexes to reduce manipulation around expiration, while the CFTC is also reviewing compliance with earlier settlement terms again.
Key Takeaways
- Polymarket has launched five-minute contracts for bitcoin, ether, Solana, and XRP on its regulated U.S. platform.
- Traders are betting on whether a crypto ends up above or below the starting price after five minutes; a correct call pays out $1.
- The CFTC is once again looking into whether Polymarket is sticking to earlier settlement terms, while settlement in these contracts remains sensitive.
Polymarket has launched five-minute crypto contracts on its regulated U.S. platform. The prediction platform operates under oversight from the Commodity Futures Trading Commission, while regulators are also taking another look at whether the company is complying with earlier agreements.
How the Contracts Work
The new products let traders bet on whether a crypto ends up above or below the starting price over a five-minute period. That applies to bitcoin, ether, Solana, and XRP. The payout is simple: a correct prediction pays $1 (€0.90), while a wrong one pays nothing. That means even small price moves can decide the outcome.
The setup is similar to binary options, a product that has existed in traditional markets for a long time. The big difference is that here, the outcome depends entirely on where the price ends, not on how big the move is. According to market analyst Mati Greenspan, a simple up-or-down button may look easy, but it says nothing about how experienced the other side may be.
Why Settlement Remains Sensitive
The debate around these contracts mostly comes down to settlement. Researchers previously looked at Polymarket's five-minute bitcoin contracts and found that trading activity picked up sharply right before expiration. In some cases, that seemed to line up with price moves that could affect the outcome of bets.
For the U.S. market, Polymarket now uses CF Benchmarks indexes, with the closing price calculated from 60 observations in the final 60 seconds. That is meant to make a sudden last trade less effective than using a single closing price. Greenspan called that a speed bump, not a force field. Iliya Kalchev of Nexo pointed out that bitcoin is harder to move because of its liquidity than smaller tokens.
Oversight and European Relevance
The launch comes at a time when the CFTC is once again investigating whether Polymarket is following the 2022 settlement terms, including blocking U.S. users on the offshore platform. For European crypto followers, this matters because it shows how quickly prediction markets and short-term derivatives are developing under stricter rules. Kalshi, another CFTC-regulated platform, already reported more than $1 billion (€0.9 billion) in crypto event-contract volume in March 2026, underscoring the interest in this kind of product.
Meanwhile, the broader legal fight over prediction markets is still going on. In the U.S., the question of who gets to regulate these markets is still on the table, adding extra uncertainty for the sector.
There is also growing attention on how these contracts are being used. The CFTC had already warned about manipulation in prediction markets, precisely because short event contracts can be vulnerable to strategic trading around settlement.
