Gemini

Army

Polymarket

Prediction market platform Polymarket is rolling out new monitoring and detection tools following backlash over alleged insider-informed betting activity, partnering with blockchain analytics company Chainalysis to strengthen oversight.
Polymarket said Thursday it selected Chainalysis to provide an onchain market integrity solution aimed at monitoring trading activity and enforcing platform rules.
The detection model is “designed to surface patterns consistent with insider knowledge in prediction markets,” the company said.
The move follows a string of controversies in which traders appeared to profit from non-public or potentially manipulated information tied to real-world events.
Recent incidents have intensified scrutiny from regulators and the public. In April, the US Justice Department <a href="https://www.justice.gov/opa/pr/us-soldier-charged-using-classified-information-profit-prediction-market-bets" rel="noopener noreferrer nofollow">charged</a> a US Army soldier with using classified knowledge to place large winning bets on the US capture of Nicolas Maduro.
The US Senate on Thursday passed an amendment to the chamber's Standing Rules that would immediately prohibit senators from trading on prediction markets.
<img alt="Insider trading backlash forces Polymarket to step up surveillance" height="602" src="https://payload.lum-tri.org/api/media/file/pasted-image-193.png?prefix=media%2Fcontent" width="785">
Source: <a href="https://x.com/Cointelegraph/status/2047455574137168323" rel="noopener noreferrer nofollow">Cointelegraph</a> on X
In response, Polymarket is bolstering safeguards to flag suspicious trading behavior, aiming to curb insider activity and restore confidence in its markets. As <a href="https://cointelegraph.com/news/polymarket-rules-update-manipulation-insider-trading" rel="noopener noreferrer nofollow">Cointelegraph recently reported</a>, the company has already implemented stricter trading safeguards to address concerns about manipulation.&nbsp;
The developments underscore mounting regulatory pressure on crypto-based prediction markets, which critics say enable speculation on sensitive geopolitical and real-world events.
Related: <a href="https://cointelegraph.com/news/kalshi-eyes-crypto-expansion-with-perpetual-futures-launch-report" rel="noopener noreferrer nofollow">Kalshi mulls crypto expansion with perpetual futures launch: Report</a>
<h2 id="prediction-markets-draw-surging-volumes-and-rising-scrutiny">Prediction markets draw surging volumes — and rising scrutiny</h2>
Prediction markets are attracting renewed attention as their size and scope continue to expand. A <a href="https://cointelegraph.com/news/prediction-markets-25-7b-monthly-volume-report-retail-activity" rel="noopener noreferrer nofollow">recent report by Bitget Wallet and Polymarket</a> found that monthly trading volumes reached $25.7 billion in March, even as the broader crypto market remained in a prolonged slump.
The data suggests retail participants are driving much of the activity, with a shift away from one-off bets toward more sustained engagement, particularly in sports-related markets.
<img alt="Insider trading backlash forces Polymarket to step up surveillance" height="724" src="https://payload.lum-tri.org/api/media/file/pasted-image-194.png?prefix=media%2Fcontent" width="1250">
Prediction market trading volumes. Source: <a href="https://cointelegraph.com/news/prediction-markets-25-7b-monthly-volume-report-retail-activity" rel="noopener noreferrer nofollow">BitGet Wallet</a>
At the same time, not all of the attention has been positive. Alongside concerns over market manipulation, a <a href="https://cointelegraph.com/news/cftc-sues-3-states-prediction-market-regulation" rel="noopener noreferrer nofollow">regulatory tug-of-war</a> is emerging between US states and the federal Commodity Futures Trading Commission over how prediction markets should be governed.
New York has recently filed lawsuits against exchange operators Coinbase Financial Markets and Gemini Titan, alleging that their prediction market offerings violate state gambling laws.
Related: <a href="https://cointelegraph.com/news/new-york-sues-coinbase-gemini-unlicensed-markets" rel="noopener noreferrer nofollow">New York targets Coinbase, Gemini in fresh crackdown on prediction markets</a>

Insider trading backlash forces Polymarket to step up surveillance

Table of Contents

Cointelegraph

Other articles published on Apr 30, 2026

Join our free newsletter for daily crypto updates!