As the U.S. Commodity Futures Trading Commission (CFTC) quietly initiates the rule-making process for prediction markets, without yet announcing specific timelines and terms, the entire regulatory chessboard has begun to be reshuffled: on one side, platforms like Polymarket face dilemmas between federal derivatives regulation and state-level gambling regulation, while the Hyperliquid policy center and Multicoin Capital have taken the lead in submitting joint opinions to the CFTC, demanding that the federal government draw clear lines to avoid fragmented regulation by states as gambling businesses; on the other side, Kraken's parent company Payward has opted to preemptively adjust licensing boundaries through acquisitions, acquiring the embedded wallet business of Magic Labs through an asset sale, transferring its millions of wallet customers to Kraken's Payward Services, with the licensed entity taking over the account system, while Magic Labs retreats to the protocol layer to focus on developing the Newton protocol, phasing out front-end wallet operations; during the same period, Tether announced that its gold-backed digital asset XAUT received Islamic law compliance certification from Amanah Advisors, targeting religious financial scenarios such as Islamic banking, insurance, savings, trade financing, and collateral. While regulatory rules remain in the stages of public comment and drafting, the boundaries of federal and state authority have yet to be finalized but have already been rewritten in advance by platform mergers and compliance routes, and this strategy of "proactive self-regulation" is quietly changing the positioning and bargaining chips of participants in the crypto and capital markets on the regulatory landscape.

Who regulates prediction markets: Federal oversight versus state gambling frameworks

After the CFTC initiated the creation of rules for prediction markets, what is truly at stake is the federal-state power struggle over "who ultimately regulates this business." Once the rules clearly define prediction contracts as commodities under the jurisdiction of the CFTC, the entire category of business will receive unified regulatory coordinates at the federal level, rather than being fragmented into state gambling lines and subjected to local customary law and gaming regulations on a state-by-state basis. The joint opinion by the Hyperliquid policy center and Multicoin Capital effectively aims to seize the narrative at this critical juncture: they urge the CFTC to include prediction markets within its regulatory boundaries and explicitly oppose state regulation as gambling businesses, intending to lock future compliance costs and business models within a predictable federal financial regulatory framework, rather than a fragmented state-level gambling system.

This positioning struggle is a matter of life and death for the already operating prediction platforms. Platforms represented by Polymarket are currently wavering between federal derivatives oversight and state gambling regulation; if some states classify them as gambling businesses, they could face a drastic increase in licensing requirements and compliance obligations, potentially being forced to "de-financialize" their products, transforming prediction products that were originally structured as financial contracts into forms more akin to traditional betting, and will face stricter restrictions on user access, risk control, and geographical coverage; conversely, if future rules stabilize their regulatory status under the CFTC, the compliance pathways for such platforms will be designed more around commodity derivatives registration, risk disclosure, and institutional connection, with users accessing these types of products being considered participants in the financial market rather than merely entertainment consumers. The ultimate outcome of this jurisdictional dispute will directly determine whether prediction platforms in the U.S. are shaped into financial infrastructure or high-risk entertainment ventures.

Hyperliquid bets on federal unified regulation

During the open comment period for the CFTC, Hyperliquid chose not to take a low-key approach but instead established a policy center to bring itself to the regulatory discussion table as a platform entity; alongside it was Multicoin Capital, an investment firm that has long bet on the crypto derivatives space and is more familiar with the narrative system of the U.S. capital markets. The two merged their interests in the regulatory draft contest via a joint opinion: they hope that future prediction markets will be regarded as a federal derivative business, subject to CFTC oversight, rather than being regulated as gambling businesses by individual states. The reasoning behind this is very practical—if classified under state gambling frameworks, cross-border platforms like Hyperliquid would have to operate in the U.S. under dozens of different licenses and compliance lists, compromising on financing, institutional collaboration, and product design around the "entertainment consumer" label; in contrast, a unified federal derivatives regulatory framework would reduce duplicated licensing and compliance costs, allowing them to connect with larger capital and institutional clients under the identity of "financial market infrastructure."

The joint opinion on regulatory boundaries is not only about Hyperliquid and Multicoin securing space for themselves but also experimenting with a replicable path for the entire sector. Currently, the classification of prediction platforms like Polymarket in the U.S. remains unresolved as either federal derivatives or state gambling; if the CFTC adopts the arguments proposed by Hyperliquid and Multicoin, it would provide a clear compliance template for subsequent projects—reporting product structures, disclosing risks, and designing contract cycles within the CFTC framework, rather than negotiating state-by-state compromises on gambling licenses. For other derivatives projects, this demonstration effect is even critical for maintaining business continuity amid policy cycles’ changes: having clear federal written rules prevents them from being treated as experimental subjects in a "gray area" during changes in government and enforcement directions, thereby placing them within a predictable regulatory trajectory.

Kraken acquires Magic wallet, licenses embedded systems

While the prediction market awaits the establishment of federal rules, Kraken's parent company Payward chose to first clean up its own internal "gray areas"—by acquiring Magic Labs’ embedded wallet business through asset sales, directly integrating this long-time product that straddled "developer tools" and "fund accounts" into the exchange's licensing system. The key to the transaction structure lies in the reshaping of customer relationships: since 2018, Magic Labs has accumulated over 60 million wallets and served more than 200,000 developers (according to a single source), and the users and funds associated with these wallets will be entirely migrated to Payward Services after the transaction, with the latter becoming the new "customer recording entity" and fund custodian.

Once the embedded wallets are integrated into the licensed exchange system, the boundaries of account management, KYC, and anti-money laundering will no longer be defined arbitrarily by technical service providers. Previously, developers perceived Magic as a "front-end integration component," making it difficult for end users to realize they were using a product close to an account system; after migrating to Payward Services, each embedded account must undergo customer identification, transaction monitoring, and fund custody according to exchange standards. From a regulatory perspective, wallets are no longer "developer tools," but seen as compliance fronts extended from licensed institutions. More subtly, after the transaction is completed, Magic Labs will not be integrated into the Kraken group but will retain its independent company structure, retreating to the protocol layer to focus on developing the Newton protocol, thus concentrating the operational responsibilities on entities within the Kraken framework. This split of "licenses in Kraken, technology in Magic" provides a clear path for regulatory penetration: regulators can directly point to the licensed Payward Services to explain account and fund flows, while positioning Magic as a regulated collaborator rather than a fund entity, drawing a more predictable boundary between technical outsourcing and compliance responsibilities.

Magic Labs retreats to the protocol layer for compliance transformation

After selling the embedded wallet business and completing the customer migration to Payward Services, Magic Labs is betting its future on the Newton protocol: shifting from a wallet operator for end users to a technical company solely responsible for protocol development and maintenance. It retains its independent corporate structure but no longer engages directly in account custody and operational obligations under licenses, passing all "fund interfaces" needing direct dialogue with regulators to Payward Services, which is already under Kraken's licensing framework. For developers, the original logic of integrating the Magic wallet has been rewritten to utilize the Newton protocol for technical integration, while user onboarding, fund transfers, and identity verification are clearly assigned to the licensed platform within the compliance framework.

This retreat to the protocol layer essentially reflects a proactive maneuver to carve out parts of its operations that require licensing for the operational entity while retaining what can be viewed as technical provider functions. In some jurisdictions, protocol layer projects are regarded as technical service providers, with distinct regulatory positioning from licensed operators; Newton fits into this gap by reconstructing role boundaries: developers access wallet functions through the protocol without directly assuming user fund and KYC responsibilities. The first responsible parties for user fund security, transaction record retention, and data compliance become licensed platforms like Payward Services, while Magic must prove that its protocol design does not undermine the fulfillment of these obligations. This division of responsibilities alleviates the licensing burden on developers while focusing regulatory accountability on the real controllers of funds and data.

XAUT receives Sharia certification and advances into Islamic finance

At the same time that the licensed structure and data responsibilities are being redefined, Tether has chosen to reinforce product boundaries from another angle—religious compliance. Its gold-backed digital asset XAUT has received Islamic law compliance certification from Amanah Advisors, which is not just a marketing move but positions the product directly within the regulatory framework of Islamic finance. Islamic law has explicit restrictions on interest, excessive speculation, and asset backing, requiring that financial arrangements be supported by real assets with risk-sharing rather than one-way interest income. These constraints determine whether Muslim institutions can comfortably use the product from a religious perspective. By obtaining compliance opinions from third-party legal advisors, XAUT effectively provides a compliance statement that can be submitted to religious committees and internal reviews, bringing the formerly marginal digital gold into the discussion framework of existing religious financial tools.

Tether itself has stated that this certification aims to enhance XAUT's acceptance in scenarios involving Islamic banking, insurance, savings, trade financing, and collateral. However, the "entry license" for religious finance is just the first hurdle; it must subsequently intertwine with the regulatory regimes of securities, payments, and foreign exchange in various countries. The Middle East and broader Muslim markets often require financial products to meet both Sharia and local licensing requirements simultaneously; once XAUT is used for trade financing or as collateral, local regulatory bodies may reference traditional gold products for its classification, scrutinizing its backing structure, clearing paths, and pricing risks accordingly. If XAUT is seen as a security or is subject to payment and foreign exchange frameworks in certain jurisdictions, Tether must meet the regulatory expectations of the corresponding sector in terms of information disclosure, custody arrangements, and cross-border flow, with any deviation directly undermining the actual value of the Sharia certification in the eyes of institutions. For Tether, this intersection of religious norms and secular regulation is pushing XAUT from a technical product toward a long-term commitment shaped by multiple compliance frameworks.

Industry proactively sets boundaries before federal rules are finalized

During the interim period when federal prediction market rules have yet to take shape, the power struggles over regulatory authority and business boundaries have already unfolded along three lines: on one end, the Hyperliquid policy center and Multicoin Capital actively entered the CFTC's comment gathering process, attempting to pull platforms like Polymarket back from state gambling frameworks into federal derivatives regulation; on another end, Kraken's parent company Payward, through the acquisition of Magic Labs' embedded wallet business, has migrated millions of accounts into its licensing framework, preemptively answering the question of "who operates the licensed front"; while on the third end, Tether submitted XAUT for review by Amanah Advisors to anchor its compliance path in religious financial norms, seeking a parallel regulatory pathway alongside secular regulation for its use in Islamic banking, insurance, and trade financing scenarios. Under the interplay of these three factors, the "multi-track system" created by the combination of federal oversight, state gambling laws, and religious financial norms is reshaping the landscape of crypto business, but this landscape remains full of critical gaps: the timeline for the release of CFTC's final rules and specific terms is yet undecided, the transaction amounts and valuations of Kraken and Magic Labs have not been disclosed, and the actual adoption data and market impact following XAUT's Sharia certification are also undisclosed. What industry participants can currently do is to influence the framework through submitting comments before the rules are established, reallocating licensing responsibilities through mergers, and creating differentiated scenarios in religious compliance, using predetermined business boundaries to face future regulation rather than being passively rewritten by it.

Join our community to discuss together and become stronger!
Exclusive Hyperliquid benefits for AiCoin: https://app.hyperliquid.xyz/join/AICOIN88
Exclusive Aster benefits for AiCoin: https://www.asterdex.com/zh-CN/referral/9C50e2
On-chain Telegram community: https://t.me/AiCoinWhaleData
On-chain community: https://www.aicoin.com/link/chat?cid=N6OVMor5g
AiCoin on-chain Twitter: https://x.com/aicoinwhaledata

免责声明：本文章仅代表作者个人观点，不代表本平台的立场和观点。本文章仅供信息分享，不构成对任何人的任何投资建议。用户与作者之间的任何争议，与本平台无关。如网页中刊载的文章或图片涉及侵权，请提供相关的权利证明和身份证明发送邮件到support@aicoin.com，本平台相关工作人员将会进行核查。