Early Wednesday morning, the FBI raided the Soho apartment of Polymarket CEO Shayne Coplan only a week after the presidential election in which the crypto-based trading platform predicted a victory for Donald Trump.
Knock, Knock
The Federal Bureau of Investigation knocked on the door of Polymarket CEO Shayne Coplan at approximately 6:00 AM on Wednesday with a search warrant and proceeded to seize phones and electronic devices. The 26-year-old entrepreneur and his team believe the raid was politically motivated. It’s “grand political theater at its worst,” a source said. “They could have asked his lawyer for any of these things. Instead, they staged a so-called raid so they can leak it to the media and use it for obvious political reasons.”
Speculation from the Polymarket camp is that the raid was a tit-for-tat response because the trading platform predicted an easy win for Donald Trump, as opposed to traditional polling that had the race as a virtual tossup. Many liberal-leaning news sources have alluded to Polymarket manipulating the market in favor of Trump. “This is obvious political retribution by the outgoing administration against Polymarket for providing a market that correctly called the 2024 presidential election,” the source said.
The morning before the election, Polymarket revealed Trump had a 58.6% chance of winning the election compared to just 41.4% for Harris. Sources allege Polymarket has ties to allies of Trump and skewed the market intentionally.
Polymarket Banned in America
One of Polymarket’s most prominent investors is billionaire entrepreneur Peter Thiel, who contributed $70 million to the upstart Silicon Valley company. Polymarket paid a $1.4 million fine to the Commodity Futures Trading Commission (CFTC) for failure to register with the agency. It subsequently banned Americans from trading with the company, although access can be facilitated through virtual private networks.
Election contracts were recently legalized by a federal court ruling but only through CFTC-regulated markets; therefore, Polymarket is still banned in the United States. US-licensed online sportsbooks are also prohibited from accepting any wagers on elections, as they are not contracts but rather wagers. The distinction is slight, but election contracts purchased through trading platforms are dynamic, much like commodity futures, where the price of the contract can rise and fall until a specified date closing the contract.
On Wednesday afternoon, Coplan jested on X, “new phone, who dis?” implying his phone had been seized and his new phone had none of his contacts. But later Coplan took a more serious tone, posting, “It’s discouraging that the current administration would seek a last-ditch effort to go after companies they deem to be associated with political opponents. (…) This is obvious political retribution by the outgoing administration against Polymarket for providing a market that correctly called the 2024 presidential election,” said a spokesman for the New York-based company.
Coplan has asserted that Polymarket is nonpartisan and that he was neither arrested nor charged in the raid.
Calculators
