Newsweek reports, Polymarket, the crypto-based prediction market platform, this time after its founder, Shayne Coplan, found himself at the center of a high-profile FBI raid. On Wednesday, federal agents seized Coplan’s devices, with reports indicating the raid is part of a larger investigation into whether Polymarket violated U.S. laws by accepting trades from American users. While the platform is currently unavailable to U.S. residents, reports suggest some traders are bypassing this restriction using VPNs.
The FBI’s actions have sparked accusations of political retaliation. A Polymarket spokesperson described the raid as “political retribution” from the Biden administration, a sentiment echoed by Coplan himself, who took to social media to criticize the government’s apparent attempt to target companies linked to political adversaries.
The timing of the raid is especially significant, as Polymarket’s platform has garnered attention for its accurate predictions in the lead-up to the 2024 U.S. Presidential Election. While many traditional pollsters forecasted a tight race, Polymarket consistently gave former President Donald Trump better odds against Vice President Kamala Harris, calling the election in Trump’s favor as early as October, long before the official results. This success has prompted some to question whether traditional polling is becoming obsolete.
Polymarket works by allowing users to place bets on the outcomes of events like elections, with the odds determined by market demand for specific outcomes. Unlike traditional polls, which are based on surveys, Polymarket’s predictions are driven by the financial stakes of its users, who bet real money on the expected outcomes. This model, Coplan argues, creates a more accurate and dynamic view of election probabilities, as it integrates real-time information and investor sentiment.
Despite the platform’s accuracy in predicting Trump’s victory, Polymarket’s credibility has not gone unchallenged. Investigations into the platform’s operations have raised concerns about the potential for market manipulation, with reports of large, coordinated bets skewing predictions. In October, for example, a small group of high-rolling investors—referred to as the “Trump Whale”—placed significant wagers on Trump’s success, causing a noticeable shift in the odds.
Nevertheless, Polymarket’s role in forecasting the election has underscored a broader shift in political prediction models. While traditional polls, such as those from FiveThirtyEight, were widely seen as misjudging Trump’s support base—particularly among “shy” voters who distrust institutions—Polymarket’s decentralized betting model has been viewed by some as a more reliable gauge of public sentiment.
Now, with the FBI investigation casting a shadow over the platform, questions loom about the future of crypto-based prediction markets in U.S. politics. As Polymarket’s founder faces legal scrutiny, the debate about the reliability of polling versus prediction markets has only intensified.
For Coplan, the FBI’s raid has become the latest chapter in a high-stakes game where the outcomes of political battles may no longer be solely in the hands of pollsters—but in the wallets of those who bet on them.
