Federal law enforcement officials raided the home of Polymarket CEO Shayne Coplan on Wednesday.
The prediction market was a breakout success in the U.S. presidential election, a platform where billions of dollars worth of bets were placed on the outcome. Polymarket traders viewed Donald Trump as the likely winner, as indeed he was.
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The raid was confirmed by a Polymarket spokesperson. The New York Post and Axios reported the news earlier. According to the Post, the feds took Coplan’s phone and other electronic devices. By all accounts, Coplan has not been arrested or charged with any wrongdoing.
“This is obvious political retribution by the outgoing administration against Polymarket for providing a market that correctly called the 2024 presidential election,” the spokesperson said in a statement. “Polymarket is a fully transparent prediction market that helps everyday people better understand the events that matter most to them, including elections.”
Polymarket is supposed to block U.S. persons from accessing its services, after coming to a settlement with the U.S. Commodity Futures Trading Commission in 2022.
A CFTC spokesperson told CoinDesk on Oct. 30 that, “Polymarket is required to adhere to the terms of the settlement they reached with the CFTC. Full stop. That means they cannot accept any business from people living in the United States or US persons as we write in the order. It’s pretty clear. It is incumbent on the company to comply with the law.”
Despite this ban, Americans can trade on the platform though virtual private networks, or VPNs, which can be used to circumvent that prohibition. CoinDesk confirmed at least two Americans were able to place trades ahead of the 2024 election from locations in the U.S.
Last month, responding to a question from CoinDesk about price discrepancies between Polymarket and U.S.-regulated prediction market platforms, attorney Aaron Brogan said: “Legally, these markets should have limited user overlap, but anecdotally I’ve heard enough stories about individuals in the US using VPNs to access Polymarket that I doubt this is a practical barrier to efficient pricing between the markets.”
Coplan seemed to be in good spirits late Wednesday afternoon, making a wry reference to the morning’s events in a post on X.
Marc Hochstein contributed reporting.
UPDATE (Nov. 13, 2024, 21:27 UTC): Adds statement from Polymarket.
UPDATE (Nov. 13, 21:35 UTC): Adds additional information.
UPDATE (Nov. 13, 22:15 UTC): Adds quote from Aaron Brogan.
