4 weeks ago
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Polymarket, the platform that allows web users to earn or burn cash via political bets, got spanked by a federal regulator two years ago, which accused it of providing illegal trading services. Since then, as part of its settlement with the government, the site hasn’t allowed Americans to bet on its platform. However, given all the betting related to the U.S. presidential election that’s been happening lately, the business now claims to be investigating whether its anonymous, crypto-swapping users are—as they claim to be—based outside of the U.S.
A new report from Bloomberg notes that a “handful of accounts” have “spent millions of dollars worth of crypto on bets in favor of Trump’s return to the White House.” Indeed, the Wall Street Journal recently ran a story on four highly active Polymarket accounts that have been exuberantly betting on the U.S. presidential election. Some observers suspect the accounts may all be run by the same person or group. The accounts are rabidly pro-Trump and have been betting millions of dollars on the U.S. presidential election, thus creating a sense of a surge of popular support for Trump. One source interviewed by the paper intimated that the accounts may be attempting to “generate a sense of momentum for Trump going into Election Day.”
Now, Polymarket is beginning to investigate some of its biggest bettors (accounts with names like “Fredi9999” and “FozzyDiablo”) to ensure that there isn’t some irregularity going on. Just how Polymarket plans on ensuring that the people on its platform are, in fact, outside the U.S., is unclear. Frankly, it seems like the site’s defenses would be really easy to fool. Indeed, Bloomberg notes that the platform’s “system for blocking US users can be circumvented by using virtual private networks, and social media is full of instructions on how to do it.”
Gizmodo reached out to Polymarket for comment.
There are many different political bets on Polymarket, though the most closely watched is the U.S. presidential election. The consensus on the site, of late, has been that Trump will retake the White House. As I write this, the predictor scale at Polymarket shows that 64 percent of the platform’s bettors believe Trump will win, while 35 percent say that Harris will win. There has been more than $2.2 billion in trading activity related to the presidential election this year, Bloomberg writes.
However, as should be obvious, the prediction market is only based on online (and, presumably, foreign) sentiment, not on any sort of authentic insider political knowledge or polling information. While they’ve been right in the past, they’ve also been wrong a lot. One critic, Steven Tian, research director of the Yale Chief Executive Leadership Institute, claims that political prediction markets are also “rife with unchecked foreign manipulation,” writing that they can be easily warped by big money and that it is “extremely easy for deep-pocketed foreigners to single-handedly move markets.”
