The decision comes the same day that the Commodity Futures Trading Commission sued Intrade’s owner, alleging that the website “allowed unauthorized trading by U.S. customers,” Reuters reported.
The suit claims that Intrade allows U.S.-based traders to buy shares in subjects that are banned by the CFTC, and that Intrade was notified of the alleged violations in March, but “has failed to cure, or attempt to cure, its violations.”
The reaction on Intrade’s forum was one of surprise and irritation. Posters expressed shock at the suddenness of the site’s decision, while others lamented the difficulties of closing their accounts.
“[I] don’t even know how to begin trying to unload some large positions, might be better off taking whatever gains and losses intrade gives on the 23rd,” posted WashingtonTrader.
“Yeah it will be impossible for me to unwind my Oscar bets right now. Impossible,” responded another user called Domer. “And how will they expire the contracts if one party is a US member and the other is not?”
Nate Silver, who runs the FiveThirtyEight blog at the New York Times and often cites Intrade in his predictions and analyses, tweeted earlier on Monday, before Intrade announced it would close down: “Out of all things the CFTC could be doing to protect consumers and investors, it chooses to sue Intrade?!?”
Silver has not tweeted since the site announced its decision, but one Intrade user suggested he should come to the website’s rescue.
“Ask Nate Silver for lobbying help,” suggested a poster called Ingen Angiven in Intrade’s forum.