So the internet is freaking out because
polymarket was reportedly paying college kids three grand a month
to pretend to get rich on TikTok.
They built a fake version of their own website.
They misspelled the name and everything,
and they had creators film themselves winning bets that never actually happened
on a platform that Americans aren't even allowed to use.
Videos got 140 million views.
One of them was from the Wall Street Journal,
which looked into what was actually happening here
and found out that none of the wins were real.
They published the investigation,
and it's not looking great for Polly market.
the Wall Street Journal analyzed over 11 videos from about 10 promoted creators
between December and May. 70% of them showed a bet being placed.
Not one of those bets was real.
Now, across those videos,
creators showed roughly $1.9 million in bets
and celebrated about $900,000 in wins
looking into those bets. If you'd actually placed those same bets on polymarket,
you actually would have lost $166,000.
So they were showing wins where the real outcome was losses,
and just hoping that nobody would check their work.
The dummy websites are actually pretty crazy.
Polymarket built near perfect copies of its own site.
One was literally spelled polymarket with an lowercase I instead of an L.
And they had creators film themselves placing trades on these fake sites.
For a scam operation, this was actually pretty well done.
Until it wasn't. So the videos look completely real?
Unless you zoom in on the URL,
which if you're scrolling TikTok
and you see a college kid screaming about winning $100,000
on a prediction about Trump,
you're not gonna zoom in on the URL.
The whole thing was staged.
The website was fake, the trade was fake,
the money was fake. The only winnings that were real
was the couple thousand dollars that these kids were making to make these ads.
Now, one creator showed himself winning $100,000
after Trump supposedly said the word McDonald's in January.
Which is great, except Trump never said McDonald's publicly that month.
You probably ordered it, but the clip was old,
the bat was fabricated, and the wind was fabricated.
So there's 145 videos from this one guy that appear to show $410,000 in bats.
Great ads, all fake.
They paid Adin Ross, who's one of the biggest streamers in the world,
multiple millions of dollars to promote the platform.
Now, the Waltz Regional found
Polymarket and its marketing contractor
promoted at least 19 videos
that talked up opportunities to use inside information
and manipulate markets. So they were literally advertising insider trading
as a platform,
feature creators were told not to disclose that they were being paid.
Only after the Wall Street Journal started asking questions
did they start adding at polymarket partner to their BIOS.
Which is the influencer equivalent of putting on your seatbelt
after you see the cop coming.
This isn't Polymarket's first Rodeo.
with the law,
it already Paid a 1.4 million dollar fine to the CFTC back in 2022
for operating an illegal unregistered market.
Politico reported
that Polymarkets CMO was actually sending payments through a personal Paypal,
not a corporate account. Personal Paypal
over two and a half million dollars to more than 800 creators over 14 months.
Right now, polymarket is trying to raise at a 15 billion dollar valuation
and get approved for a regulated US exchange license.
Which is tough
when you're running a campaign that literally fakes US exchange operations
and you get caught.
So this investigation landed at quite literally the worst possible time for them.
A polymarkets whole pitch is radical transparency.
Every trade settles on a public blockchain that anyone can audit.
The markets work because it's all verifiable.
So the marketing strategy to sell that product was incredibly deceptive.
Build fake websites, stage fake trades,
pay people to fake getting rich and then hide the payments.
Trust the blockchain
isn't a message that really aligns with this kind of growth campaign.
Any publicity is good publicity may not hold here.
They built fake websites to simulate fake wealth
for an audience they're not even legally allowed to serve.
This doesn't look great
from a company that's already entangled in a lot of insider trading allegations.
Polymarket is banned from letting Americans trade on their platform.
And this whole campaign targeted American social media
for a product of they can't even legally use.
That's gonna be a tough one to for Their legal team to unwind.
Some polymarket supporters are blaming the reporting,
saying that Kalshi’s investors have ties to News Corp,
which is the Wall Street Journal's parent company.
And Kalshi is Polymarket's number one op and competitor.
Which may be true, but the fake websites are verifiable.
There's only so much finessing you can do with this story.
It kind of is what it is. My bet ultimately is that Kashi,
which is regulated, they're gonna come out of this the winner.
So the prediction market that predicted the 2024 election
evidently couldn't predict
that someone was going to check up on their marketing
and know the difference between an L and an I. That's a tough loss.