NAIROBI (CoinChapter.com) — With just days until Election Day, the cryptocurrency prediction platform Polymarket has come under scrutiny amid allegations of manipulation in its betting markets. Bettors have projected Donald Trump’s chances of winning as high as 67%. Reports from blockchain research firms Chaos Labs and Inca Digital indicate a high level of wash trading on Polymarket, raising concerns about data integrity and the potential artificial inflation of Trump’s odds.
Trump’s Betting Odds Surge Amid Manipulation Claims
Trump’s odds on Polymarket, Sporting Index, and Betfair Exchange increased to over 63%, way ahead of Vice President Kamala Harris. The increase aligns only slightly with marginal polling improvements for Trump in battleground states, such as Pennsylvania. Such traders may manipulate the market by making large stakes to tip the perception in a positive direction for Trump.
Polymarket officials acknowledged the suspicions surrounding the jump in odds, stating that they are investigating claims of market tampering. The platform, which operates on Ethereum’s blockchain, allows users to place bets using shares for various political events. Still, the odds on Polymarket now reflect the largest gap between Trump and Harris since July when President Joe Biden exited the race.
Evidence of Wash Trading Raises Further Concerns
Chaos Labs and Inca Digital conducted separate analyses and found patterns consistent with wash trading—a method where traders repeatedly buy and sell assets to inflate apparent market activity. According to Chaos Labs, wash trading constituted nearly one-third of all trades in Polymarket’s presidential market. Inca Digital’s report pointed to a similar trend, noting a “significant portion” of volume derived from manipulative trading behavior.
The firms also identified discrepancies between Polymarket’s reported trading volume and blockchain data. Polymarket cites $2.7 billion in trades for its presidential market, while on-chain data reflects only $1.75 billion. Chaos Labs attributed the discrepancy to Polymarket’s calculation methods, which register each share as $1, regardless of the actual value. This creates an appearance of higher dollar volume than actual trade values support. Polymarket’s trading methodology has since become a focal point, especially as mainstream outlets use its odds as election indicators.
Prediction Markets Under Scrutiny as Election Nears
The action of Polymarket has raised questions related to the trustworthiness of prediction markets as signals of elections. As the founder, Shayne Coplan claims use of the transparent platform accessible on block chain auditability, there is substantial proof that election manipulation may still affect the prediction markets.
A Polymarket spokesperson affirmed the platform’s commitment to prohibiting manipulation and stressed its intent to maintain a fair betting environment. Still, the evidence of wash trading has sparked industry-wide discussions about the need for improved oversight in prediction markets. This is particularly important as the U.S. election outcome approaches. As Polymarket’s data continues to circulate in political analysis, the platform’s credibility faces intense scrutiny, potentially impacting the broader landscape of crypto-native betting markets.
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