Overview
- U.S. regulators have opened a widened inquiry into Polymarket that now reportedly covers off‑chain marketing practices such as paid creators staging trades and fabricating winning bets.
- A Wall Street Journal exposé described dozens of promotional videos that used replica interfaces and simulated trades, reporting roughly $1.9 million in shown bets and about $900,000 in fabricated winnings.
- Polymarket has said it is auditing active promotional content, removed some replica sites used for videos, and declined to offer detailed public comment as the probe continues.
- The company faces renewed risk against a backdrop of a 2022 CFTC settlement for operating an unregistered exchange and prior closed federal inquiries, while the DOJ has brought a separate criminal charge tied to insider wagers.
- Lawmakers have pushed the CFTC to act and the outcome could set a precedent that extends agency power over how decentralized or blockchain‑based platforms market themselves to U.S. users.