Polymarket probes suspicious midterm election bets as House market nears $24m

Key points

• An NPR investigation published 27 Oct reported that Polymarket has investigated dozens of election-related bets, with at least two referred to the CFTC.
• Polymarket's 506 election markets include $24m in House bets and $9m in Senate bets, with Republicans given a 9% chance of holding the House.
• Traders price a Democratic sweep of both chambers at 65% ahead of the 3 Nov midterm elections.

Shana Bautista, a former FBI official who joined Polymarket in June, leads a 16-person team looking for insider dealing and market manipulation. Its surveillance draws on social media, Federal Election Commission filings, banking partners and cryptocurrency records, and flags patterns such as concentrated bursts of trading or shared device identifiers. Bautista told NPR that investigators have always been able to identify, potentially, who the traders are.

Traders on the platform favour a Democratic sweep of Congress at 65%, while a Republican sweep is priced at 8%. The House market has drawn $24m in volume, with Republicans given a 9% chance of retaining control, and the Senate market $9m, with Republican victory at 35%. Individual Senate races in Texas, Michigan and Maine have each attracted millions.

The scrutiny follows earlier action by rival Kalshi, which in April banned and fined candidates for betting on themselves and in July issued a lifetime ban to former US representative George Santos. Polymarket has previously referred more than 100 cases across various markets to law enforcement.

What to watch: The midterm elections take place on 3 Nov, with Polymarket's compliance team continuing to review suspicious bets and the CFTC yet to act on the referrals.

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