In an early-morning raid on Wednesday, federal agents seized the phone and electronics of Shayne Coplan, the 26-year-old CEO of Polymarket, a cryptocurrency-based prediction platform. The raid occurred in Coplan’s downtown Manhattan apartment and is believed to be linked to the platform’s election-related betting activity. Polymarket, known for offering odds on political outcomes, has raised concerns that the raid is politically motivated due to its predictions that heavily favored former President Donald Trump, which were at odds with mainstream polls.
Raid Sparks Questions of Political Retaliation
The search of Coplan’s SoHo apartment came just a week after the U.S. presidential election, prompting many to speculate about the timing and motives behind the federal action. Coplan, who was not arrested, responded to the raid humorously with a post on X (formerly Twitter), saying, “New phone, who dis?” signaling his awareness of the phone seizure. While Coplan remains active on social media, the raid has triggered broader concerns over potential political bias in federal actions.
Polymarket gained significant attention during the election for predicting that Trump had a higher chance of winning compared to Vice President Kamala Harris, a stance that diverged sharply from most public opinion polls. This raised eyebrows as Polymarket’s forecasts contradicted more traditional polling methodologies and sparked debate over the platform’s influence on the election narrative.
Polymarket Defends Its Non-Partisan Stance
In response to the raid, Coplan voiced his frustration, suggesting that the U.S. government may be targeting companies that show support for political challengers. “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,” he wrote, reiterating that Polymarket remains non-partisan and committed to providing a fair platform for all users.
He also expressed disappointment in the broader political environment, suggesting that a focus on fostering innovation and supporting startups could have led to better outcomes in the election, rather than singling out businesses like Polymarket.
Investigation into U.S. Users and Legal Concerns
The Department of Justice (DOJ) is investigating whether Polymarket has allowed U.S. residents to bet on its platform, which is prohibited under current U.S. gambling laws. Although Polymarket restricts users in the U.S., some have bypassed this limitation using virtual private networks (VPNs). This practice has drawn attention as Polymarket attempts to re-enter the U.S. market following a 2022 fine from the Commodity Futures Trading Commission (CFTC) for operating without the necessary registration.
In a statement, Polymarket denied any wrongdoing, calling the raid an “obvious political retribution.” The company insisted that it remains committed to offering a transparent and non-partisan prediction platform, unaffected by political influence.
The “Polymarket Whale” and International Scrutiny
Polymarket has also come under scrutiny for the activity of a mysterious French trader, dubbed the “Polymarket whale,” who made large bets predicting a Trump victory. These bets raised Trump’s odds on the platform, drawing even more attention to Polymarket. The high-stakes wagers led to significant profits for the trader—reportedly over $46 million—while also prompting French gambling authorities to investigate Polymarket’s compliance with local laws.
As Polymarket’s profile grew in the lead-up to the election, so did concerns about its legality and the potential influence of its markets on public opinion, particularly regarding the U.S. election.
Legal Challenges and Future Uncertainty
Polymarket’s legal issues are not new. In 2022, the company was forced to halt its U.S. operations after the CFTC fined it $1.4 million for failing to meet the required regulatory standards. Following this, the platform has worked to improve its compliance measures and is now attempting to relaunch its services in the U.S.
However, the platform’s decentralized nature and reliance on cryptocurrency for transactions make it difficult to regulate, raising ongoing concerns among U.S. regulators. As Polymarket prepares to re-enter the U.S. market, its legal battles are far from over.
