CFTC investigates Polymarket over fake bet campaign

• The CFTC is conducting an ongoing, extensive investigation into Polymarket, according to a source familiar with the matter cited by the Wall Street Journal and confirmed by CNBC.
• The probe follows a WSJ exposé alleging Polymarket paid creators to stage fake bets on replica versions of its platform across more than 1,100 reviewed videos.
• Two bipartisan US senators have written to CFTC Chair Michael Selig requesting written confirmation of the investigation by July 10.

The Commodity Futures Trading Commission is conducting an extensive investigation into Polymarket, the Wall Street Journal first reported on June 26.

The probe arrives as the prediction market platform faces federal scrutiny, congressional pressure, and a new consumer protection lawsuit over an alleged deceptive influencer marketing campaign.

Neither the subject of the probe nor the date it began has been disclosed. A CFTC spokesperson told CNBC the agency cannot confirm or deny any investigation. A Polymarket spokesperson also declined to comment beyond an earlier public statement.

Fake bets, real fallout

The investigation follows a June 20 Wall Street Journal report alleging Polymarket paid content creators to stage fake bets on replica versions of its platform. According to the WSJ, none of the trades were backed by real money.

The Journal reviewed 1,105 videos from ten creators active between December 2025 and mid-May 2026. Around 70% showed a creator executing a trade. The on-screen wagers totaled $1.9 million, with 118 clips depicting winnings of approximately $900,000.

Had those same 118 bets involved real money, they would have lost more than $166,000, according to the Journal.

A Polymarket spokesperson said:

“We are conducting a comprehensive audit of active promotional content to ensure it complies with our standards, as well as applicable regulatory and legal disclosure requirements.”

On June 25, Senators John Curtis (R-Utah) and Adam Schiff (D-Calif.) sent a bipartisan letter to CFTC Chair Michael Selig, calling for regulatory scrutiny of the platform’s advertising conduct. The senators requested written confirmation by July 10 on whether the CFTC is investigating Polymarket and whether the promotional practices were lawful.

Curtis and Schiff also asked Selig to clarify whether the agency has adequate resources to police prediction markets.

The following day, the National Association of Consumer Advocates filed a lawsuit against Polymarket in the Superior Court of the District of Columbia.

The complaint alleges a sweeping deceptive marketing campaign directed at college-age consumers and names Shayne Coplan, Polymarket’s founder and CEO, and Matthew Modabber, its chief marketing officer.

A pattern of scrutiny

Polymarket’s regulatory history has been turbulent. The platform was banned from the US market in January 2022 after settling with the CFTC for $1.4 million over operating an unregistered derivatives trading platform.

It was cleared to return in September 2025 following its acquisition of QCX, a CFTC-licensed derivatives exchange and clearinghouse. A limited US relaunch followed in December 2025, with a full public launch in May 2026.

Growth since the relaunch has been rapid. The platform reached $1 billion in annualized trading volume within six weeks of removing its waitlist in mid-May and now carries a reported valuation of $15 billion.

Integrity concerns have mounted alongside that growth. In a separate case, federal prosecutors charged a Google engineer with using confidential search data to generate $1.2 million in Polymarket profits, one of the most prominent insider trading cases tied to the prediction market sector.

Under Michael Selig, the CFTC has publicly championed prediction markets, filing suits against state officials who have moved to restrict or tax the platforms. A formal investigation into a licensed platform would mark the first of its kind under his leadership and represent a notable shift in how the agency positions its oversight role.

The combination of a federal probe, bipartisan Senate scrutiny, and civil litigation signals that marketing conduct, not just market structure, is now firmly in the regulatory crosshairs.