JPMorgan Cut Polymarket's Banking Ties in October 2025 Over Regulatory Concerns — and Still Wants to Underwrite Its IPO
The Financial Times has reported that JPMorgan Chase terminated its banking relationship with Polymarket in October 2025 over regulatory concerns, while simultaneously pursuing an underwriting role in a potential Polymarket IPO. JPMorgan notified Polymarket it would need a new banking partner at a time when the platform was still barred from US users following its 2022 CFTC settlement. Polymarket has since moved to an undisclosed new bank but disputes the FT's characterization, saying it maintains a 'close, active relationship' with JPMorgan on operational integrations and customer fund flows.
JPMorgan Chase quietly terminated its banking relationship with Polymarket in October 2025, the Financial Times reported on August 14, 2026, citing a source familiar with the matter. The debanking occurred while Polymarket was still prohibited from serving US users — the platform had been barred from the US market since a $1.4 million CFTC settlement in 2022 and was working toward re-entry under the loosened federal rules that emerged after the 2025 change in CFTC leadership. JPMorgan's decision was driven by regulatory risk concerns as the platform was expanding globally and preparing its US return. Polymarket has since moved its banking relationship to a different lender, which the FT did not identify.
The contradiction at the heart of the JPMorgan story is the gap between the debanking and JPMorgan's continued pursuit of an underwriting role. Despite terminating the banking relationship in October 2025, JPMorgan invited Polymarket CEO Shayne Coplan to a private banking conference in February 2026 and has retained an active interest in underwriting a potential Polymarket IPO. Polymarket disputed the FT's framing, with a spokesperson stating that the company maintains a 'close, active relationship' with JPMorgan 'regarding operational integrations and fund flows' — suggesting the banking termination applied to specific account relationships rather than all financial ties. The distinction matters commercially: a company that has been debanked for regulatory risk is a different IPO candidate than one that has merely restructured its banking arrangement while retaining broader institutional relationships.
The timing of the debanking — October 2025 — places it in a specific regulatory context. At that moment, Polymarket was operating as a global prediction market platform that had not yet re-entered the US market after its 2022 enforcement action. The CFTC's posture toward prediction markets was shifting under new leadership appointed by the incoming Trump administration, but the new framework had not yet been formalized. JPMorgan's decision to exit at that moment reflects either that the bank assessed the US regulatory path as uncertain enough to warrant exit, or that the bank had a specific concern about Polymarket's non-US operations — Polymarket at the time served users in a large number of jurisdictions with varying regulatory status for prediction market contracts. Polymarket's US operation has since launched under a separate CFTC-regulated entity (QCEX) as part of its re-entry strategy, which creates a legal firewall between the US and global books.
The broader significance of the JPMorgan story is what it reveals about banking access for prediction market platforms. Debanking — where a financial institution terminates a customer relationship for regulatory or reputational risk reasons — has been a recurring issue for crypto exchanges and fintech companies that operate in legally ambiguous categories. Prediction markets now sit in a similar position: CFTC-licensed at the federal level, but facing active state-level enforcement across eleven states and a municipal suit from Baltimore. JPMorgan's regulatory risk assessment in October 2025 — before any of the 2026 state litigation began — suggests that major banks were already modeling prediction market regulatory exposure as significant. Whether Polymarket's new banking partner is a major US bank or a smaller institution willing to take on the regulatory risk will eventually become relevant when the IPO process begins and underwriters perform due diligence on the platform's financial infrastructure.
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