Polymarket, a prediction betting platform founded by Shayne Coplan, and Coplan himself have become central figures in a growing debate over political betting after reports surfaced that the FBI raided Coplan’s New York City apartment on Wednesday.
The FBI reportedly seized a cellphone and other electronic devices during the raid, though Coplan was neither arrested nor charged. According to sources, Coplan voluntarily handed over his devices. It remains unclear whether Coplan or Polymarket are the subjects of an investigation, with both the Justice Department and the FBI declining to comment on the matter.
The New York Times revealed that the raid was part of an ongoing investigation by the FBI and the U.S. Attorney’s Office for the Southern District of New York into whether Polymarket has been operating as an unlicensed commodities exchange, facilitating illegal betting in the U.S. However, neither Polymarket nor prosecutors from the attorney’s office provided comment on the investigation.
Polymarket fined for unregistered operations, now under fresh legal spotlight
Polymarket, launched by Coplan in 2020, has drawn attention for its election betting markets, which, according to NBC News, generated over $3.6 billion in wagers during the presidential election. A particular portion of those bets focused on President-elect Trump and Vice President Harris, raising concerns about whether the betting market influenced the election outcome.
Although Polymarket is banned from accepting U.S. bets after a 2022 settlement with the Commodity Futures Trading Commission (CFTC), it remains one of the leading platforms for election betting. As part of the settlement, Polymarket agreed to pause its trading and pay a $1.4 million fine for operating without proper registration.
In the days leading up to the election, the platform saw large trades, including one from a French trader expected to win around $48 million due to Trump’s anticipated victory. This drew further criticism of the platform.
While Coplan has not publicly addressed the raid, he posted a cryptic message on social media, suggesting humorously that his phone had been seized. Later, he criticized the Biden administration, alleging that the raid was a politically motivated attack on his company’s association with Trump.
In his post, Coplan lamented the administration’s efforts to target companies linked to political adversaries, urging the current government to adopt a more pro-business, pro-startup approach. The White House declined to comment on the matter.
Elon Musk, a prominent figure in the tech industry and a supporter of crypto, expressed support for Coplan, as did other outstanding figures in the crypto world. Coinbase CEO Brian Armstrong initially suggested the raid would backfire, but later deleted his post and expressed uncertainty.
The raid also caught the attention of members of Congress. Rep. Claudia Tenney (R-N.Y.) described the FBI’s actions as potentially excessive, depending on the justification for the seizure of Coplan’s devices. She compared it to the early morning raids of other Trump supporters, such as Roger Stone.
Investor Kevin O’Leary speculated that the investigation would be quick, given the transparency of online platforms like Polymarket, suggesting that the authorities could determine if any illegal activities took place in a matter of days.
A recent federal appeals court ruling deemed election betting legal in the U.S., siding against the CFTC’s attempt to block Kalshi’s political betting contracts. Kalshi allowed users to bet on outcomes like which party would control Congress, adding another layer to the debate over political prediction markets.
