Users placed more than $7 million betting on the outcome of the crypto sleuth’s investigation, expected to be announced on Thursday.
Users of prediction markets platform Polymarket are making bets on which crypto platform will be the next target on online sleuth ZachXBT, known for investigations into scams and hacks.
As of Tuesday, Polymarket showed a 29% chance that ZachXBT would name decentralized liquidity platform Meteora on Thursday as part of what was described as a “major investigation” into “one of crypto’s most profitable businesses.” The crypto sleuth said in a Monday X post that the investigation was related to allegations of insider trading.
According to ZachXBT, the investigation would reveal that multiple employees of the yet-unnamed exchange “abused internal data to insider trade over a prolonged period of time.” Polymarket users had the chance to bet on Meteora, MEXC, Axiom, Wintermute, and others ahead of the announcement.
As of Tuesday, users had wagered more than $7 million on the target of the investigation. However, odds on Polymarket event contracts are based on user activity rather than insight into which company ZachXBT planned to announce.
Related: How ZachXBT exposed a Coinbase impersonation scam using onchain clues
It was unclear whether ZachXBT’s allegations of insider trading included company stock or digital assets.
Prediction markets under scrutiny by US policymakers
In the United States, state-level authorities are facing pushback from the Commodity Futures Trading Commission chair Michael Selig, who said last week that the federal regulator had “exclusive jurisdiction” over prediction markets, equating them to derivatives markets. Platforms like Polymarket, Kalshi, and others have been the target of lawsuits in several individual US states over allegations the companies offer illegal sports gambling to their residents.
Selig warned that any state-level entities challenging the CFTC over prediction markets would be met in court, and said that the agency had filed amicus briefs asserting its authority. Polymarket has also challenged the state of Massachusetts over its enforcement action, arguing for the CFTC’s sole authority.
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