Posted on: November 13, 2024, 08:14h.
Last updated on: November 13, 2024, 08:14h.
Polymarket founder and CEO Shayne Coplan’s Manhattan apartment has been raided by the FBI, just days after the financial exchange and prediction platform outperformed traditional polls by forecasting the result of the US presidential election.
A company spokesperson confirmed to Business Insider that the 26-year-old CEO’s home was targeted on Wednesday morning, without providing further details. The feds seized Coplan’s phone and electronic devices, according to earlier reports by The New York Post and Axios.
Coplan has not been arrested, according to the reports. Shortly after the raid, he posted on X: “new phone, who dis?”
‘Political Retribution’ Claim
The Polymarket spokesperson claimed the incident was an act of “political retribution” for predicting the election results. However, it’s more likely that the FBI are looking into the extent to which US citizens were permitted to speculate on the election via the platform.
Polymarket is a decentralized and unregulated financial exchange and prediction platform that claims to block US citizens. However, it may be possible for US users to find a workaround by using a VPN, which can disguise an internet users’ location.
The platform is believed to have handled around $3.2 billion in crypto globally from speculation on the election result.
The extent to which Polymarket takes “bets” from US citizens, if at all, is unknown. However, its claim to have predicted the election only makes sense if it has a strong sample size of registered US voters.
The platform offers events contracts, a type of derivative that allows users to speculate on the outcome of a specific event, whether that be the Best Picture at the Oscars or the next president. Traders put their money on “yes” or “no” outcomes, and the contracts expire when the result is known.
Only one platform, Kalshi, offers this service legally in the US. It is reluctantly regulated by the Commodity Futures Trading Commission (CFTC).
Election Influence?
In the run up to the election, the CFTC tried to block Kalshi from offering events contracts on the next president on the grounds that election betting is illegal in the U.S. It also cited concerns that the platform could be used to influence the results of the election.
Large bets on one candidate can skew the markets. Therefore, it could be possible for a wealthy individual or entity to manipulate public belief about a candidate’s odds of victory in an attempt to boost campaign morale and turnout.
It is believed that an unknown trader attempted – unsuccessfully — to do this by betting heavily on Mitt Romney in the 2012 presidential race.
In this election cycle, one Polymarket trader, a French national dubbed the “Trump Whale,” won $85 million by backing the former and soon-to-be U.S. president.
In an interview with The Wall Street Journal on the eve of the election, the anonymous trader denied having a political motive, claiming he had commissioned his own polls, which revealed support for Kamala Harris had been massively overstated.
The FBI may also be checking the trader’s claim of political neutrality.
