Key facts
- Polymarket is prepared to identify and stop malicious activity on its platform during the U.S. midterm elections.
- The company is actively working to block U.S. users from its international platform as mandated by a 2022 regulatory settlement.
- Polymarket utilizes machine learning, blockchain analytics, trade surveillance, and open-source research to maintain market integrity.
- The company has referred more than 100 cases to law enforcement, including alleged insider betting using classified information.
- Polymarket settled with the CFTC in 2022 for failing to register and was required to bar U.S. users.
Prediction market company Polymarket is enhancing its controls and is prepared to police trading activity as the U.S. midterm elections approach, according to Shana Bautista, the company's new global head of investigations and intelligence.
Bautista stated that Polymarket has systems in place to identify anomalous activity and is working to keep U.S. users off its international platform, a requirement stemming from a 2022 enforcement settlement with U.S. regulators. The company faces scrutiny from lawmakers concerned about potential insider trading and threats to election integrity posed by prediction markets.
Polymarket utilizes machine learning, blockchain analytics, trade surveillance, and open-source research to detect and prevent malicious activity. The company has referred over a hundred cases to law enforcement, including instances involving alleged use of classified information for betting and possible insider bets on U.S. military actions.
In 2022, the Commodity Futures Trading Commission fined Polymarket for operating without registration and mandated that it bar U.S. users. Despite this, some U.S. users are believed to continue trading on the platform, though Bautista expressed confidence that the company's safeguards block the majority.
During the Trump administration, federal regulators dropped a probe into Polymarket's settlement compliance. The company has since re-entered the U.S. market through the acquisition of a U.S.-registered exchange.