FBI Raids Home of Polymarket CEO Shayne Coplan
axios.com
axios.com
When I saw that statement, from a company spokesperson, it was striking.
Is it now respectable and advisable for a corporation to make official statements like this?
Such a weird thing to blame it on.
The current US government is the most corrupt entity in the history of the world, if you multiple corruption times power.
And I love my country (USA), but just hate what the government has become over the past 60-80 years.
Current ? "Mark Twain: 'There is no distinctly American criminal class - except Congress'"
Yeah, should't be weird, should be obvious. (lobby, insider trading, etc)
For ever...
Their audience here is the incoming administration, which is founded on party loyalty and an "us-vs-them" mindset, where "them" are the corrupt elites.
They're making a bet that whoever is prosecuting them in 4 months is going to be a lot friendlier to them if they act like victims of a vengeful democratic elite, and they're probably right. Really smart, honestly.
Or all the people he pardon'd in exchange for indirect money.
It's literally transactional.
If that's the case, I would've expected to the statement to be something like, "From our understanding, our only crime is to have presented an analysis that the outgoing administration also understood to be valid."
This kind of conspiratorial thinking dominates the Republican party and such a story would play well with the base. There is a clear motive for this approach - and it seems likely to work.
https://www.theguardian.com/technology/2024/nov/13/fbi-raid-...
We have no information about why they are there, so you conclude it must be political retribution and they must be protected. THIS is why Trump won. So many people have zero critical thinking skills. When you see something that for which you have no information, you can say "I wonder what is going on." Then, you stop. Things that could be:
* Using collected data to facility spear phishing campaigns. * Running a child pornography/sex trafficking ring. * Participating in dogfighting. * Been a back channel for selling trade secrets. * Had some people killed. * Routing all the information collected to foreign groups, like Russia. * or.. has the other half of messages to someone under investigation whose phone locked.
But, given I have zero evidence to support any of this, let's stick with "let's see what they say."
- Using collected data to facility spear phishing campaigns. - Running a child pornography/sex trafficking ring. - Participating in dogfighting. - Been a back channel for selling trade secrets. - Had some people killed. - Routing all the information collected to foreign groups, like Russia. - or.. has the other half of messages to someone under investigation whose phone locked.
A real-world example of "zero evidence". Let's stick with "no lying". Also, in late 2024, giving the monstrously corrupt FBI the dishonesty-based benefit-of-the-doubt is beyond naive and comfortably in the realm of dishonest.
It has been days since I have seen such an example of "zero critical thinking skills"
That the FBI raided the home of an individual most likely means a criminal investigation of that person, for a federal crime or a crime that crosses state boundaries.
they are investigating Polymarket itself
It's not about political inclination but rather that there's no reason to keep trusting a source that has lied repeatedly, sensationalized repeatedly, and seems to have a very loose relationship with being "journalism" rather than entertainment (bait).
https://www.bloomberg.com/news/articles/2024-11-13/polymarke...
I guess it follows the pattern of the Binance investigation where they were able to show the Binance CEO instructed people to make sure the technical measures they implemented to ensure only non-US people were on their exchange were easy to bypass.
[1] https://www.bloomberg.com/news/articles/2024-11-13/polymarke...
- Polymarket is still very illegal in the US
- Lol. We all know it's easy to get around that
- If the CEO knew or was complicit in US citizens breaking laws, he could be in trouble. And if there was evidence he was encouraging it, he could be in big trouble
Well, maybe for startups in general, but it apparently didn't work out for Polymarket. Also, it's probably a better case if you're just not targeting US customers, rather than being actually forbidden from trading with US customers.
Fireworks are illegal in NY and have been illegal in PA for much of the past two decades. Despite this, the border is crawling with fireworks stores. PA made it illegal to sell fireworks to PA residents, but totally legal to sell to residents of neighboring states provided they immediately transport them over state lines.
https://www.reuters.com/legal/us-federal-court-upholds-rulin...
> Polymarket has blocked access to Americans since 2022, following a settlement with the Commodity Futures Trading Commission, which accused the company of running an unregistered derivatives-trading platform. Traders say the ban on U.S. users can be circumvented using virtual private networks.
>Election betting was legalized in the U.S. under a recent federal court ruling, but only for CFTC-regulated markets, so Polymarket has remained off-limits to Americans.
https://www.wsj.com/us-news/law/fbi-polymarket-ceo-investiga...
Polymarket has avoided coming under regulation by the CFTC by avoiding US users. For their markets to be legal under current regulations they'd have to have all their markets approved by CFTC.
It should be obvious what happened here: Polymarket has been offering grey or black markets to users, using only IP address as the discriminator, which is very easy to work around. They've operated under the Feds' radar for quite some time, and the Feds noticed them after they started getting significant press regarding the election.
The election is the reason they got noticed, but the likely crime itself is sports, not elections.
Neither Civil Servants nor Senior Executives can be directly terminated by the President without due process. Only appointees can be fired on a whim, and their replacements must be confirmed by the Senate. The only exception to this is "recess appointments" made when the Senate is not in session, but those appointments are temporary, and Congress can stay in session as long as needed (until the next seating after an election) to block these as long as both Houses agree to do so.
Many federal agencies today are actually governed by boards of commissioners, with limits on the number of them that can be from the same party.
the frontpage being almost exclusively about US politics is kind of a giveaway
I most receently used the site yesterday to see what the incumbent Australian government’s reelection chances are after they tabled ‘ID and age requirements to use social media’ laws, but polymarket didn’t seem to have Australian politics odds, so I was left using oddschecker, which is inferior due to the annoying way it displays odds and it not storing historical data.
I think that phrasing is a bit too optimistic. Even in cases where the "prediction" cannot influence the outcome, the primary "learning about the world" involves the imputed opinions of bettors.
Betting at horse-races doesn't teach you nearly as much about horses as actually going to the stables. :P
Edit: to be clear, I’m referring to polymarket essentially “calling” each swing state well before the networks did. I’m not just referring to the overall outcome.
Very tricky.
I would be interested in a blog post explaining it.
The classical fallacy is attributing skill to someone who has successfully predicted 10 coin flips (or market trends) in a row, ignoring the fact that there were many other people making different predictions and there was always going to be one of them who was successful.
I mean, yeah, you technically learn something, but the limitations undercut the sales-pitch.
There are many recent examples of fed agencies doing aggressive tactics and getting overturned in the courts (Rare Breed Triggers or Polymer80 vs. ATF, or Apple vs. FBI for forced phone unlocks). Don't let them bully you into not building something that you believe is good for society!
I've heard this point argued a few different ways, and I have to say: this is the most idiotic way of analyzing the world I can imagine. Don't listen to gamblers or people who think superforecasters are a real thing. Studying the world and reflecting on it thoughtfully will get you a lot further than these probabilities ever will.
Was he arrested? The article only mentions a search.
Innocent until proven guilty is a cornerstone of our civilization. We should not shame anyone who has been searched or arrested by the police.
Technically sure, you're correct. The worst kind of correct.
So you have the take the stand and testify.
> [1] The pardon would have put Nixon in a difficult position on the witness stand since he would not have been able to assert any Fifth Amendment privilege when questioned about his actions as president.
[1]: https://en.wikipedia.org/wiki/Pardon_of_Richard_Nixon#Afterm...
This thread started with that statement, which is what I based my comments on.
To take the piss on it, only a fool would pardon someone for a crime of which they are not accused.
Are you implying that point?
There are a other trivial examples. Confederate solders weren't indicted [1]. The Vietnam draft dodging pardons didn't even name people [2] [3].
Why they would do it? I mean to nullify the 5th amendment right. Maybe you want to prosecute a crime boss so you give somebody a pardon (or immunity) so they can't/don't plead the 5th and have to testify against them.
[1]: https://en.wikipedia.org/wiki/Pardons_for_ex-Confederates#An...
[2]: https://en.wikipedia.org/wiki/Draft_evasion#Pardons
[3]: https://www.nytimes.com/1977/01/22/archives/texts-of-documen...
You have a reading challenge. GP said conviction required, which is not true. You can be pardoned for something you did but nobody knows you did it.
No.
"The President ... shall have Power to grant Reprieves and Pardons for Offenses against the United States, except in Cases of impeachment" [1]. Everything after that is, at best, case law.
[1] https://en.wikipedia.org/wiki/Federal_pardons_in_the_United_...
See Alex Tabarrok's triumphant take from before the raid: https://marginalrevolution.com/marginalrevolution/2024/11/pr...
Here's an interesting question. We know that if a bettor in a prediction market wants to manipulate the market's prediction, it's likely to be extremely costly for them (though Théo's big bet on Polymarket seems to have shifted it a lot, so maybe we should doubt this theory). Does the operator of a prediction market have less-costly ways to manipulate the prediction?
Other than just shutting down the market permanently on Election Day, Mt. Gox style, which is an extremely profitable scam whether you manipulated the predictions or not.
About a decade ago I was told by someone on GOOG's anti-spam team that they had thought they'd finally made it too costly to spam, only to discover that political spammers just didn't care how much it cost.
Observably, so far, political spammers do not obtain ten trillion dollars per US election to spend on influencing it. Arguably this is only because they haven't found an effective way to spend that much money, and we should be very concerned that a mere 50 million dollars seems to have been enough to influence the prediction market results quite seriously in this case.
But that's not necessarily inherent to markets, even prediction markets. Foreign exchange rates were a major issue in our last election, because our rate of inflation was top in the world last year, but it isn't plausible for political parties to bet enough in forex futures markets to influence their predictions of those exchange rates—because banks bet almost 8 trillion dollars per day in the forex markets, so to intentionally maintain an irrational prediction in the market over the several months of the campaign, you'd need to be rich enough to expend roughly the entire world yearly GDP, and willing to lose it.
If sending spam required posting a bond set by the receiver, to be paid to the receiver if they decided the email was unwanted, I think you'd find that even political spammers did start to care a great deal about the cost. Until they cared, I'd set up domains with billions of potential receivers, each setting a ten-dollar bond. After the political spammers transferred their first few billion dollars to me, they'd run out of money.
Come to think of it, that sounds a lot like diplomatic exchanges during the Bronze Age: sending your ambassador along with a bunch of gifts like exotic animals and spices and slaves was an implicit way of saying "I'm confident you'll want to hear my guy out; confident enough that if you don't think his proposal is worthwhile, just keep these gifts and don't reciprocate them".
for good measure, Mark Twain on lagniappe:
> The shopman always responds; gives the child a bit of licorice-root, gives the servant a cheap cigar or a spool of thread, gives the governor—I don't know what he gives the governor; support, likely.
I make an account from a US IP. I can’t make a bet.
I use a VPN, while still logged into the same account. I can make a bet. It’s possible that simple IP geo-fences aren’t considered “good enough” to avoid KYC if other information is available (prior IP address or even just IP at signup)
I don't even understand what the conspiracy theory is here. Why would that be something the Biden administration would seek retribution for? And even it were, how would they possibly achieve it before the new administration takes office?
Polymarket probably thinks that the Biden administration is angry with them for showing how the population truly feels as all other sources are obviously corrupt /s
https://bitcoinmagazine.com/print/operation-choke-point-2-0-...
* E.g. the New Yorker, "Polymarket has seen a recent surge in pro-Trump election bets. Is it the movement of a rational market or a concerted campaign?" or Newsweek, "Polymarket Prediction Platform Possibly Manipulated to Favor Trump"
The FBI is quite good at serving multiple warrants in multiple locations at the same time when pursuing conspiracies. Presumably, in the scenario where they are the conspiracy, they could do just as well.
It doesn't seem like a great conspiracy theory to explain what actually happened.
- Many in the "crypto community" have perceive the Biden administration as hostile to it (Polymarket uses Polygon crypto).
- Peter Thiel is an investor in Polymarket. Thiel backed Trump in '16 and is often Republican aligned. Additionally, JD Vance once worked for Thiel. Thiel was a (very) major funder of Vance's senate election campaign.
- Polymarket's markets predicted Trump to win. This, to me, is the biggest stretch of all the conspiracy type stuff. But I guess it goes, "You put your thumb on the scales to show Trump was going to win. <...some causal chain of events...> We lost. Now we're going to punish you."
My guess is that it's as straightforward as: many bettors on Polymarket are U.S. citizens. Polymarket knows this and in all likelihood facilitates this, maintaining the thinnest possible veneer of plausible deniability. While betting on U.S. elections by U.S. bettors is apparently legal [1], it still requires market makers to submit to some registration process. That requirement has not been fulfilled by Polymarket. Also, in 2022 Polymarket settled a case with the CFTC for operating an unregistered derivatives market [2]. Who knows, it might just be related to a violation of that settlement?
[1] https://www.nbcnews.com/politics/2024-election/election-bett...
“Political retribution by the outgoing administration” = “I’m the enemy of your enemy”. “Correctly called the 2024 presidential election” = “I’m flattering you on your glorious victory over our shared foe, now hook a brother up.”
In any case, attempting to use a derogatory or denigrating euphemism to refer to something is usually less productive than simply exposing (what you perceive to be) its faults. What specific issues do you have with these markets/exchanges?
Gambling is a destructive addition that the vast majority of participants cannot manage well. It harms not only them, but their children and their spouses. How many a kid's college fund has gone up in smoke? A lot of harm is done to very innocent people in pursuit of a ten second rush. (Much like all other addictions.)
I also very respectfully disagree that inventing a name for something is not productive - it's incredible effective, in fact. That's why political campaigns often favour duelling names over hot button issues: it's easier to win broad based support from soccer moms and football dads for 'marriage equality', whereas 'homosexual marriage' may be a harder sell. See also 'medicare for all' versus 'socialized medicine', 'pro-choice' v 'pro-life' etc.
A traditional sportsbook maintains a house vig anywhere from 5 to 15%, which is, indeed, a pretty fast path to ruin. They typically don't allow you to exit your position once you're committed.
Polymarket's sports markets, in contrast, have comparable bid/ask spreads to financial markets (maybe slightly wider), and the market is liquid such that you can sell your contract to someone else whenever you want.
Whoever said other markets aren't gambling?
> Polymarket's sports markets, in contrast, have comparable bid/ask spreads to financial markets (maybe slightly wider), and the market is liquid such that you can sell your contract to someone else whenever you want.
'Financial markets' is a slippery term - you could be using it to refer to traditional investing (holding a diversified share portfolio for years because you believe in the fundamentals of the companies in question), or you could be using it to refer to things like frenetic speculating in short-dated out-of-the-money 'binary option' contracts.
The former is not gambling (no 'rush', not generally addictive, very hard to go broke, mathematically sound), and the latter is absolutely 100% gambling (all rush, totally addictive, incredibly easy to lose your shirt, mathematically stupid). There have been many attempts at 'finance-washing' straight up gambling schemes in recent years, and I wouldn't be surprised if we see more crackdowns soon.
Pretending that betting on election results is some complex financial derivative that is totally magically immune to laws about gambling isn't going to fool any judge.
(And I got the term "gambling exchange" from the UK where Betfair Exhange basically does what Polymarket do since 2000, without the Crypto glamour.)
"Binary options are gambling products dressed up as financial instruments. By confirming our ban today we are ensuring that investors don’t lose money from an inherently flawed product."
https://www.fca.org.uk/news/statements/fca-confirms-permanen....
Sound familiar?
They also highly regulate CFDs and other financial instruments that are marketed to retail.
Congrats on using the worst argument in the world: https://www.lesswrong.com/posts/yCWPkLi8wJvewPbEp/the-noncen...
The rest of what we see are (binary) event contracts (options)
Based on my understanding, which may be incorrect, they seem to be basically a rebranding of binary options which were illegal in the US for the longest time. With a clever renaming trick things now work :)
Thank you to share.
> Rules and limits
> The IEM is neither regulated by the U.S. Commodity Futures Trading Commission (CFTC) nor by any other agency due to its academic focus and the small sums that are involved. Indeed, the IEM has received two no-action letters that extend no‑action relief. A speculator may put at risk in the IEM only between $5 and $500.
> They are banned across Europe, Australia, the U.K., and many other jurisdictions because of their volatility and are often seen as wagers more akin to gambling than sound investing.
> A binary call can similarly be replicated with other options
its more wasteful for some segment of our society to need a distinction between investing or gambling at all, the people they're competing against don't care, don't have any cultural limitation, religious limitation, or peer group that needs this distinction. and your "legitimizes" wording looks based on needing a distinction.
even with the "positive or negative expected value" metrics to distinguish some financial games, I've traded options contracts with a lower expected value than a table game at a casino. so just don't worry about the distinction and use our words for the specific game we're playing. prediction markets are prediction markets.
Because insurance is quite literally a prediction market.
Not trying to be snarky, I know certain religions actually do consider insurance to be gambling.
I think, indeed, a lot of people are effectively using the markets to gamble, but the same can be said for equities/futures.
I see no reason they shouldn't be allowed, since there are proxies that people can trade as well
They describe it as "profit from your knowledge by betting on future events across various topics" on their own website.
Betfair Exchange can be used to make predictions, too. They call it "implied probability" and it's always been a feature of their product.
My concern is the use of terminology to describe a gambling product as something else entirely.
Is it a prediction market than can be used to gamble?
Or is it a gambling exchange that can be used to make predictions?
An insurance company sells options contracts. We call it healthcare. It is , aside from a few small differences, the same as a put or a call.
An insurance company's day-to-day operation is indistinguishable from a derivatives hedge desk. Insurance companies absolutely take massive bets. These are managed by re-insurers.
And now they are trying to play with society from the top-down by rebranding as "prediction markets for everything", not only pretending to sell a crystal ball but also setting up the incentives for those at the top of the financial system to destroy society and bet on the destruction of society at the same time. I say: shatter their poker chips, dissolve the house, don't allow them to accumulate any more of this type of power.
Typically they get "debanked" without explanation, and it's really hard to run a startup without a bank account...
This podcast with a16z co-founders Marc Andreessen and Ben Horowitz tells the stories: https://youtu.be/g4jWb-0nj44?si=_hK92xyF56lG0ezd&t=100
2. A ton of options trading is gambling, and binary options on events particularly so. Doesn't mean it should be illegal, of course, but I think that's just a facially obvious truth that we should all be honest with one another about.
Feels wrong.
Because the conspiracy theorists wouldn't have gone to town if the market predicting Trump's win were shut down before the election?
Polymarket hit popular imagination in the summer of 2023 with the Titan submersible [1]. American political betting didn't hit papers until earlier this year. We're well within normal FBI timelines for executing a first search.
[1] https://polymarket.com/event/will-the-missing-submarine-be-f...
Another could be concern of doing anything visibly election related prior to the election, in case the winner didn’t like the action.
Of course, the exact meaning of "necessary" is the problem. We can probably all agree that letting a serial murderer kill more people in order to have more evidence against him would be an absolute abomination. But the situation is not that clear with white-collar crime, especially the sort of crime where the harm is not immediately obvious.
Maybe the fact that the FBI could wait that long before pouncing indicates that this sort of betting is, in fact, a victimless crime.
I'm confused what your point is? Is it when cops/prosecutors build cases that take time they are tacitly saying the crime is victimless? Do you think law enforcement should only target street level dealers/car thieves because to spend time building cases against drug distributors/chop shops renders the crime victimless?
That is simply not how it works and for good reason. If it were, imagine the consequences. Most charges would never lead to a trial or a conviction because law enforcement would have acted on the very first sign of criminal action instead of investigating further or working their way up the chain. We'd only end up arresting low level foot soldiers and the higher ups would get away every single time.
As HL Mencken once said 'Democracy is the theory that the common people know what they want, and deserve to get it good and hard.'
https://www.justice.gov/jm/jm-9-85000-protection-government-...
> " Any action likely to raise an issue or the perception of an issue under this provision requires consultation with the Public Integrity Section, and such action shall not be taken if the Public Integrity Section advises that further consultation is required with the Deputy Attorney General or Attorney General. "
Don't get stuck in a framing story.
I think in this case, polymarket allows betting on anything, competitors got betting on the election legalized (https://www.barrons.com/news/last-minute-legal-ruling-allows...), so they get the cash from polymarket's idea then get them banned/stopped long enough to take their market share.
VC's call it Regulatory Capture, politicians call it corruption.
> VC's call it Regulatory Capture
This isn't regulatory capture. You can disagree with the regulation, but the barrier to entry here is not that high. Kalshi is like 5 years old.
"Capture" is a thing, and it does not just mean "any regulation that I happen to disagree with".
You do need capital to stand up a regulated exchange, but, then, you also need capital to stand up an unregulated exchange. And the difference between those two numbers is not nearly big enough to come anywhere close to creating capture.
Instead, it means regulatory agencies become dominated by the interests of those they were originally charged to regulate.
I still speculate this raid to be Kalshi/Robinhood/whomever to be going after polymarket at a prime time- the concept of betting on events got huge and the industry of event-hedging directly (avoiding the stock market proxy) no longer needs to band together to get the idea out- now it's a matter of getting all the consumers to choose your particular product vs a competitors.
I don't think you are at all correct about the relationship between Polymarket and other event trading venues. For one thing, Kalshi and polymarket are basically contemporaneous. For another, Polymarket plays at these games too (Polymarket has a former Commissioner of the CFTC on their board).
To the extent that Polymarket is playing in the legal grey zone, it's an active choice on their part, not a result of competitors' regulatory advantage or Polymarket's lack of access to regulatory leverage.
IMO, the counters to my speculations would be that the raid was because they got too popular and the gov didn't want a million people starting up their own exchanges, or they reached a monetary tipping point the gov set to warrant a raid.