Polymarket Teams With Chainalysis to Detect Insider Trading

Prediction market Polymarket has partnered with blockchain analytics firm Chainalysis to track and reveal insider trading.

There is growing concern about insider trading in prediction markets, in which users bet on the outcome of everything from sporting matches to elections. In April, an Army Green Beret was charged with using classified knowledge of the operation to capture Venezuelan President Nicholas Maduro to win $400,000. He has pled not guilty.

Chanalysis will provide data analytics and monitoring systems, investigative tools to provide information for law enforcement and regulators, and onchain security capabilities to assist Polymarket in identifying and eliminating insider trading.

The goal is to flag suspicious trading patterns indicating a trader may be acting on inside information, Polymarket announced on April 30.

“Polymarket was built on-chain because transparency matters, and our platform shows what markets can look like when trades are open, traceable, and accountable by design,” said Shayne Coplan, Founder and CEO of Polymarket. “Every market deserves that standard. This partnership with Chainalysis pairs that transparency with the monitoring and enforcement infrastructure to back it up, and helps us continue to build the most trusted source of truth in markets.”

Polymarket is fully onchain, with every trade, position, and settlement recorded on the Polygon blockchain.

“That activity is transparent and traceable by design, and can be harnessed to set a new public standard for market integrity in prediction markets and beyond,” Polygon said. “This sends a clear signal: insider trading, in addition to all types of fraud and market manipulation, is not welcome on Polymarket, and those who attempt it will be identified.”

Prediction markets have gained a reputation for being better predictors of outcomes than traditional polling. While wagers on sporting matches remain the biggest part of prediction markets’ business, it was betting on election outcomes — specifically the election of Donald Trump in 2024 — that pushed them into the mainstream consciousness.

Polymarket has partnered with Dow Jones, owner of the Wall Street Journal, to use prediction market information in reporting and market coverage.

While it is the biggest prediction market worldwide, Polymarket has still not entered the United States fully. As a result, it is losing its lead to competitor Kalshi, which is active in the U.S. market.