US Investigates Polymarket After Presidential Election

The FBI has seized the phone and electronic devices of Polymarket founder Shane Coplan.

The FBI is investigating the prediction market platform Polymarket to see if it has an impact on the 2024 US presidential election, according to the New York Post.

Specifically, the FBI seized the phone and electronic devices of Shayne Coplan, Polymarket founder and a US citizen, at his New York home. Bloomberg also reported that Mr. Colan is also under investigation for allegedly allowing Americans to trade on Polymarket.

FBI seizes Polymarket CEO’s phone, electronics after betting platform predicts Trump win: source https://t.co/c0fkO9F1Oa pic.twitter.com/Kh2o3ejH5l

— New York Post (@nypost) November 13, 2024

Mr. Coplan has not been arrested yet, and quickly issued a “cryptic” statement on social media X (Twitter):

“It’s disappointing that the current administration is trying to prosecute companies that they believe are on the wrong side of their opponents. We’ve always tried to be politically neutral, and the current administration should look at themselves and realize that if they had taken a more pro-business and pro-startup stance, they wouldn’t have lost the election.

Polymarket delivered value to tens of millions of users during this election cycle, and we’re incredibly proud of that.”

It’s disconcerting that the current administration would seek a last-ditch effort to go after companies they deem to be associated with political opponents. We are deeply committed to being non-partisan, and today is no different, but the incumbents should do some self-reflecting…

— Shayne Coplan 🦅 (@shayne_coplan) November 13, 2024

Previously, on November 7, Polymarket closed the results of the 2024 US presidential election prediction market, with the victory belonging to Mr. Donald Trump. This market attracted a trading volume of up to 3.6 billion USD. Since the beginning of October, when the race for the White House was intense, the prediction rate of Mr. Trump winning the election has always been higher than Ms. Harris, despite the survey results from major US news agencies showing the rate is always at 50-50.

The New York Post’s sources commented on the FBI’s actions, claiming that this was “political retaliation” by the current administration for Polymarket’s alleged market manipulation and deliberate election bias in favor of Trump.

In early 2022, Polymarket agreed to pay a fine of $1.4 million to the US Commodity Futures Trading Commission (CFTC) after being accused of offering options trading without a license. They had to pay a fine of $1.4 million, as well as block users from the US to avoid further trouble.

The CFTC still maintains that prediction markets do not allow betting on the outcome of the US presidential election, but lost the case to Kalshi and was forced to let the startup launch its product in September. Other companies such as Robinhood and Wintermute also quickly launched prediction markets to take advantage of the growing interest in the US presidential election.

As reported by Coin68, Polymarket raised $70 million in 2 rounds of funding in 2024, with the participation of billionaire Peter Thiel's Founders Fund and Ethereum founder Vitalik Buterin. The prediction market in September also revealed its intention to raise an additional $50 million and airdrop its own token to retain users after the US presidential election.