Polymarket probes dozens of election-related bets ahead of midterms
Polymarket's global intelligence team has investigated dozens of election bets, referring at least two cases to the U.S. Commodity Futures Trading Commission, while deploying a surveillance system that generates hundreds of daily alerts.
Polymarket has examined "dozens" of bets tied to the upcoming midterm elections, according to Shana Bautista, the platform's head of global intelligence and investigations. At least two of the investigations have been forwarded to the U.S. Commodity Futures Trading Commission, a source familiar with the matter said.
Bautista, a former FBI official, said her team of 16 analysts and a newly deployed election surveillance system are monitoring betting activity ahead of the Nov. 3 elections. "If you have information that you have a duty to protect, don't trade on it," she warned, noting that such conduct violates both the platform's terms of use and the law.
The surveillance system aggregates data from social media, Federal Election Commission records, cryptocurrency firms, banking partners and other public sources. When a user's activity triggers a set of internal red-flag criteria, Bautista receives an alert on her phone. "We're getting hundreds of alerts a day," she said.
While Polymarket operates a U.S.-regulated version that requires real-name registration and an international version that allows anonymous cryptocurrency trading, Bautista said the company can usually identify the individuals involved. "There's never been a case that we work where we haven't been able to identify, potentially, who these people are," she said.
The platform's efforts come as prediction markets have grown in popularity but face scrutiny from regulators and lawmakers who argue that betting on election outcomes could threaten democratic processes. Competitor Kalshi has also introduced an election surveillance system that blocks campaign staff listed by the FEC from betting, reporting that it has barred "dozens" of staffers.
Economics professor Rajiv Sethi of Barnard College noted that election prediction markets can become self-fulfilling prophecies, where beliefs about outcomes may influence actual results. Bautista said Polymarket's system learns from past cases and adapts to detect patterns such as multiple accounts, rapid trades, and shared device identifiers that could indicate insider trading or market manipulation.