Polymarket Faces Broad CFTC Probe Amid Fake Bets Allegations

The Commodity Futures Trading Commission (CFTC) is conducting an extensive investigation into crypto prediction market platform Polymarket, according to a Bloomberg report citing a person familiar with the matter. The probe centers on allegations that Polymarket paid online influencers to create fake bets and winnings aimed at U.S. users, potentially violating previous regulatory bans.

The investigation, which began earlier this year, includes scrutiny of Polymarket’s social media activities. This is the third CFTC investigation into the platform. In 2022, Polymarket paid a $1.4 million fine and agreed to bar U.S. users after being found to operate an illegal, unregistered exchange. Between 2024 and 2025, the CFTC and Department of Justice investigated whether the platform violated that ban but closed the case without charges.

The latest probe follows a Wall Street Journal report alleging that Polymarket paid influencers to create content depicting fake bets and wins without disclosing their partnership with the platform. In response, U.S. Senators Adam Schiff and John Curtis called on the CFTC to investigate the platform’s deceptive marketing, requesting a written response by July 10.

Separately, Polymarket founder Shayne Coplan and Chief Marketing Officer Matthew Modabber face a lawsuit filed by the National Association of Consumer Advocates. The suit alleges a ‘sweeping deceptive market campaign’ targeting young Americans, particularly college-aged individuals, to gamble real money while obscuring the likelihood of losses. The complaint names Coplan for his ultimate decision-making authority and Modabber for overseeing advertising practices central to the WSJ report.

Source: https://coingape.com/polymarket-faces-broad-cftc-probe-amid-fake-bets-allegations/