WEBVTT 00:00:00.080 --> 00:00:01.480 So the internet is freaking out because 00:00:01.481 --> 00:00:05.006 polymarket was reportedly paying college kids three grand a month 00:00:05.007 --> 00:00:06.886 to pretend to get rich on TikTok. 00:00:06.887 --> 00:00:09.166 They built a fake version of their own website. 00:00:09.167 --> 00:00:10.766 They misspelled the name and everything, 00:00:10.767 --> 00:00:14.806 and they had creators film themselves winning bets that never actually happened 00:00:14.807 --> 00:00:17.886 on a platform that Americans aren't even allowed to use. 00:00:17.887 --> 00:00:19.766 Videos got 140 million views. 00:00:19.767 --> 00:00:22.206 One of them was from the Wall Street Journal, 00:00:22.207 --> 00:00:24.646 which looked into what was actually happening here 00:00:24.647 --> 00:00:26.686 and found out that none of the wins were real. 00:00:26.687 --> 00:00:28.006 They published the investigation, 00:00:28.007 --> 00:00:30.446 and it's not looking great for Polly market. 00:00:30.647 --> 00:00:34.966 the Wall Street Journal analyzed over 11 videos from about 10 promoted creators 00:00:34.967 --> 00:00:39.626 between December and May. 70% of them showed a bet being placed. 00:00:39.726 --> 00:00:41.986 Not one of those bets was real. 00:00:42.006 --> 00:00:43.286 Now, across those videos, 00:00:43.287 --> 00:00:46.326 creators showed roughly $1.9 million in bets 00:00:46.327 --> 00:00:49.746 and celebrated about $900,000 in wins 00:00:49.886 --> 00:00:53.446 looking into those bets. If you'd actually placed those same bets on polymarket, 00:00:53.447 --> 00:00:56.686 you actually would have lost $166,000. 00:00:56.687 --> 00:00:59.566 So they were showing wins where the real outcome was losses, 00:00:59.567 --> 00:01:01.866 and just hoping that nobody would check their work. 00:01:01.886 --> 00:01:04.866 The dummy websites are actually pretty crazy. 00:01:04.926 --> 00:01:08.306 Polymarket built near perfect copies of its own site. 00:01:08.366 --> 00:01:12.866 One was literally spelled polymarket with an lowercase I instead of an L. 00:01:12.901 --> 00:01:16.821 And they had creators film themselves placing trades on these fake sites. 00:01:16.822 --> 00:01:20.101 For a scam operation, this was actually pretty well done. 00:01:20.102 --> 00:01:22.581 Until it wasn't. So the videos look completely real? 00:01:22.582 --> 00:01:24.101 Unless you zoom in on the URL, 00:01:24.102 --> 00:01:25.781 which if you're scrolling TikTok 00:01:25.782 --> 00:01:29.261 and you see a college kid screaming about winning $100,000 00:01:29.262 --> 00:01:30.581 on a prediction about Trump, 00:01:30.582 --> 00:01:33.541 you're not gonna zoom in on the URL. 00:01:33.542 --> 00:01:34.805 The whole thing was staged. 00:01:35.027 --> 00:01:36.867 The website was fake, the trade was fake, 00:01:36.868 --> 00:01:39.607 the money was fake. The only winnings that were real 00:01:39.667 --> 00:01:43.935 was the couple thousand dollars that these kids were making to make these ads. 00:01:43.936 --> 00:01:46.510 Now, one creator showed himself winning $100,000 00:01:46.511 --> 00:01:50.270 after Trump supposedly said the word McDonald's in January. 00:01:50.271 --> 00:01:54.330 Which is great, except Trump never said McDonald's publicly that month. 00:01:54.350 --> 00:01:56.430 You probably ordered it, but the clip was old, 00:01:56.431 --> 00:01:59.350 the bat was fabricated, and the wind was fabricated. 00:01:59.351 --> 00:02:05.230 So there's 145 videos from this one guy that appear to show $410,000 in bats. 00:02:05.231 --> 00:02:06.678 Great ads, all fake. 00:02:06.680 --> 00:02:09.921 They paid Adin Ross, who's one of the biggest streamers in the world, 00:02:09.922 --> 00:02:12.601 multiple millions of dollars to promote the platform. 00:02:12.602 --> 00:02:13.881 Now, the Waltz Regional found 00:02:13.882 --> 00:02:15.961 Polymarket and its marketing contractor 00:02:15.962 --> 00:02:18.001 promoted at least 19 videos 00:02:18.002 --> 00:02:20.961 that talked up opportunities to use inside information 00:02:20.962 --> 00:02:24.961 and manipulate markets. So they were literally advertising insider trading 00:02:24.962 --> 00:02:26.681 as a platform, 00:02:26.682 --> 00:02:30.721 feature creators were told not to disclose that they were being paid. 00:02:30.722 --> 00:02:33.401 Only after the Wall Street Journal started asking questions 00:02:33.402 --> 00:02:36.201 did they start adding at polymarket partner to their BIOS. 00:02:36.202 --> 00:02:39.441 Which is the influencer equivalent of putting on your seatbelt 00:02:39.442 --> 00:02:40.785 after you see the cop coming. 00:02:40.957 --> 00:02:43.668 This isn't Polymarket's first Rodeo. 00:02:43.669 --> 00:02:44.208 with the law, 00:02:44.352 --> 00:02:49.610 it already Paid a 1.4 million dollar fine to the CFTC back in 2022 00:02:49.611 --> 00:02:52.090 for operating an illegal unregistered market. 00:02:52.091 --> 00:02:52.850 Politico reported 00:02:52.851 --> 00:02:57.750 that Polymarkets CMO was actually sending payments through a personal Paypal, 00:02:57.770 --> 00:03:00.090 not a corporate account. Personal Paypal 00:03:00.091 --> 00:03:04.847 over two and a half million dollars to more than 800 creators over 14 months. 00:03:04.848 --> 00:03:08.485 Right now, polymarket is trying to raise at a 15 billion dollar valuation 00:03:08.486 --> 00:03:11.525 and get approved for a regulated US exchange license. 00:03:11.526 --> 00:03:12.485 Which is tough 00:03:12.486 --> 00:03:17.325 when you're running a campaign that literally fakes US exchange operations 00:03:17.326 --> 00:03:18.125 and you get caught. 00:03:18.126 --> 00:03:22.525 So this investigation landed at quite literally the worst possible time for them. 00:03:22.526 --> 00:03:24.725 A polymarkets whole pitch is radical transparency. 00:03:24.726 --> 00:03:28.165 Every trade settles on a public blockchain that anyone can audit. 00:03:28.166 --> 00:03:30.685 The markets work because it's all verifiable. 00:03:30.686 --> 00:03:34.503 So the marketing strategy to sell that product was incredibly deceptive. 00:03:34.504 --> 00:03:36.623 Build fake websites, stage fake trades, 00:03:36.624 --> 00:03:39.643 pay people to fake getting rich and then hide the payments. 00:03:39.743 --> 00:03:40.743 Trust the blockchain 00:03:40.744 --> 00:03:44.406 isn't a message that really aligns with this kind of growth campaign. 00:03:44.407 --> 00:03:47.248 Any publicity is good publicity may not hold here. 00:03:47.249 --> 00:03:49.553 They built fake websites to simulate fake wealth 00:03:49.554 --> 00:03:52.080 for an audience they're not even legally allowed to serve. 00:03:52.255 --> 00:03:53.535 This doesn't look great 00:03:53.536 --> 00:03:57.855 from a company that's already entangled in a lot of insider trading allegations. 00:03:57.856 --> 00:04:01.175 Polymarket is banned from letting Americans trade on their platform. 00:04:01.176 --> 00:04:04.055 And this whole campaign targeted American social media 00:04:04.056 --> 00:04:06.775 for a product of they can't even legally use. 00:04:06.776 --> 00:04:09.535 That's gonna be a tough one to for Their legal team to unwind. 00:04:09.536 --> 00:04:11.775 Some polymarket supporters are blaming the reporting, 00:04:11.776 --> 00:04:14.655 saying that Kalshi’s investors have ties to News Corp, 00:04:14.656 --> 00:04:16.535 which is the Wall Street Journal's parent company. 00:04:16.536 --> 00:04:19.655 And Kalshi is Polymarket's number one op and competitor. 00:04:19.656 --> 00:04:23.743 Which may be true, but the fake websites are verifiable. 00:04:23.744 --> 00:04:25.932 There's only so much finessing you can do with this story. 00:04:25.933 --> 00:04:29.229 It kind of is what it is. My bet ultimately is that Kashi, 00:04:29.230 --> 00:04:31.383 which is regulated, they're gonna come out of this the winner. 00:04:31.384 --> 00:04:33.903 So the prediction market that predicted the 2024 election 00:04:33.904 --> 00:04:35.103 evidently couldn't predict 00:04:35.104 --> 00:04:38.423 that someone was going to check up on their marketing 00:04:38.424 --> 00:04:42.565 and know the difference between an L and an I. That's a tough loss.