WSJ probe turns scrutiny on Polymarket as prediction markets open interest hits $1.48B

Even though one of the biggest brands in the industry is facing difficult issues about how it presents itself, prediction markets are making record profits.

Prediction market open interest reached a record $1.48 billion in the week ending June 15, a second consecutive all-time high, according to a16z Crypto.

Unlike trading volume, which only monitors daily buying and selling, open interest counts the value of active bets that are still in play.

It displays the amount of money that traders are still risking. Open interest has increased sixfold in the last year, indicating that participants are seeing prediction markets as a more permanent component of trade and keeping their bets open longer.

Even though big events continue to garner attention, many traders now routinely place bets on a variety of topics, including politics, the economy, culture, cryptocurrency, and more.

Paid creators and fake profit videos

There is a lot of baggage associated with the financial high.

In order to promote its services, Polymarket allegedly bribed social media artists to publish fictitious trading and profit videos, according to the Wall Street Journal.

Polymarket flooded social media with videos that appear authentic at first glance in an effort to attract users to its unregulated website.

The Journal discovered that the corporation constructed almost identical versions of its own website and instructed developers to place fictitious wagers on those phony pages while concealing the fact that Polymarket was compensating them.

Certain clips were returned to the corporation for inspection, while others depicted large gains that never occurred.

According to the creators, Polymarket requested that they retake a film if it wasn’t thrilling enough or if it was obviously false.

They also said the company told them not to admit they were being paid, and that the money often came to $2,000 to $3,000 a month.

Many of the videos followed the same script: a creator opens Polymarket, places a bet, and calls the winnings “free money.”

According to the Journal, Polymarket engaged Virality, a marketing company, to oversee influencer initiatives. A network of social media accounts republished the videos to increase their reach.

The ad purportedly targeted American users, who may still access the website through VPNs, even though Polymarket has been prohibited from running its primary cryptocurrency platform in the United States since 2022.

In an effort to draw in new customers, Polymarket reportedly inked a multimillion-dollar contract with streamer Adin Ross.

Polymarket declared in a statement that it is “committed to maintaining accurate, fair, and transparent markets. We are part of a rapidly growing industry and are constantly evaluating ways to improve how we’re engaging and earning the trust of our audience.”

According to the corporation, a thorough analysis of the current promotional content will be conducted.

A push into pop culture

While the controversy plays out, Polymarket is trying its hand at mainstream media. Recently, it teamed up with Dear Media to launch its first podcast, “What Are the Odds?”, a weekly audio and video show that mixes pop culture news with live trading numbers.

The move pushes the company out of dry financial media and into celebrity gossip, movie releases and award show talk.

So far, Polymarket’s users have been a narrow, mostly male group.

Sports betting makes up about 39% of its trading volume, crypto about 20%, and politics another 32%.

That adds up to 91% in just three areas, leaving 9% for everything else. The new show is meant to grow that slice.

“Our partnership with Dear Media marks a new chapter in how prediction markets capture the pulse of culture around the world,” said Josh Tucker, Polymarket’s head of creative marketing.

Rather than read a script, the hosts react to live data, viewing the week’s biggest pop culture moments through the lens of betting markets. Video episodes land on YouTube every Friday, with audio versions on Spotify, Apple Podcasts and other platforms.

This push beyond traditional finance proves that despite operational friction, the market’s trajectory remains upward.

Don’t just read crypto news. Understand it. Subscribe to our newsletter. It's free.