Polymarket pulls U.S. pilot market after Moulton backlash
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- Polymarket pulled a U.S. pilot market after Representative Seth Moulton objected, saying the market "should not have been listed" and that it was reviewing how it passed internal safeguards.
- Polymarket did not specify which integrity rule was violated, prompting pushback — Business Insider's Jack Newsham wrote on X that he checked the TOS and "Market Integrity" page without finding a relevant prohibition.
- Polymarket's daily fees jumped from roughly $363,000 to over $1 million after it expanded its fee model on March 30, applying broader taker fees across finance, politics, and tech categories.
- Traders using newly created wallets made about $1 million by correctly betting on the timing of US strikes on Iran, with some positions placed hours before the attacks — activity that raised insider-trading suspicions.
- 42 Democratic lawmakers have urged the CFTC and the Office of Government Ethics to warn federal employees against using non-public information to trade on prediction markets.
Why it matters: Polymarket's decision to remove the market without citing a specific rule undermines the credibility of its integrity claims at a moment when the platform is simultaneously scaling up monetization (fees up to ~$1M/day) and facing bipartisan concern over insider trading — meaning its growth story now competes with a regulatory narrative that 42 lawmakers are actively pushing.
