Separate investigations from Chaos Labs and Inca Digital allegedly found that approximately 30% of the 2024 United States Presidential election activity on Polymarket is the result of wash trading — a method of market manipulation designed to artificially boost volume.
According to the report from Fortune, both firms claim the actual transaction volume on the prediction platform was only $1.75 billion, compared to the $2.7 billion reported by Polymarket.
Analysts from Chaos Labs attributed this discrepancy in transaction volume to Polymarket counting shares for candidates in whole dollar amounts, despite individual shares on Polymarket trading well under $1.
Data from Dune also revealed the total open interest for the 2024 presidential election on the platform was just north of $150 million. This open interest figure is a different metric than the billions in transaction volume due to traders selling their positions to other participants on the platform.
Polymarket open interest. Source: Dune
Related: Prediction markets are not being manipulated — Kalshi founder
Fears of market manipulation grip Polymarket
Until early October, the spread between the two United States presidential candidates remained narrow and competitive. However, this began to change when Trump pulled ahead of Harris on Oct. 12 by a solid 10-point lead.
This lead only increased with time, culminating in the former president’s current lead of roughly 30 points over Harris — which is almost unheard of in traditional US presidential polling.
Accusations of market manipulation began to spread as the divergence between the two candidates continued to grow, prompting Polymarket to investigate in an effort to filter out US users and potential market manipulators.
Following the investigation, Polymarket claims to have identified a single individual responsible for running four separate accounts — Fredi9999, Theo4, PrincessCaro, and Michie — on the platform that was responsible for $28 million in pro-Trump bets.
Although the individual remains unnamed, spokespeople for Polymarket characterized the individual as a seasoned trader and a French national.
Shortly after Polymarket published the findings of its investigation, another whale reportedly placed an additional $2 million in pro-Trump bets; however, the individual appears not to be linked to the French national identified by Polymarket.
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