Polymarket Faces Scrutiny Over Potential Insider Trading in Prediction Markets

Recent movements in a Polymarket prediction market are raising eyebrows over potential insider trading ahead of an anticipated investigative release by on-chain sleuth ZachXBT. Titled 'Which crypto company will ZachXBT expose for insider trading?', the market saw one option, Meteora, leap from negligible to a 44% implied probability of being the target within a 24-hour window, fuelling suspicions among traders of informed positioning. While U.S. legislators have begun indicating concerns and mooting stricter regulations following incidents of suspiciously timed bets on such markets in 2025, the Polymarket rules prohibit trading based on non-public material information. Compliance experts, however, point out the difficulty in policing such activity on pseudonymous platforms. As the market awaits ZachXBT's official revelation set for Feb. 26, the debate intensifies on the need for increased oversight in cryptocurrency prediction markets.