Polymarket Paid to Fake Winning Bets

Introduction

A college kid named George Makihara posted a video last winter showing a $100,000 win on Polymarket, off a $1,000 bet that Donald Trump would say the word "McDonald's." It went viral. Then the Wall Street Journal pulled Polymarket's real ledger for that month and found 50 accounts had placed that same bet. Every one of them lost.

Makihara's win never happened. The trade was staged on a password-protected replica of the site, one of 1,105 videos that Polymarket quietly paid creators to make over five months, together pulling in more than 140 million views of ordinary people supposedly getting rich on bets that were never real. If you've ever watched a clip like that and used it to judge whether some app or bet was legit, that reaction is the whole product. What makes this more than the usual influencer hype is the timing: during the same months Polymarket was manufacturing fake proof that regular people win, real insiders were quietly winning for real on the same platform. The federal regulator whose job is to catch them had closed its only open investigation into the company six weeks before Donald Trump Jr.'s venture firm bought in and he took a board seat.

Paid to Look Rich

The Wall Street Journal published its findings on June 20; CBS News walked through them in detail. Reporters reviewed 1,105 videos from 10 creators posted between December 2025 and mid-May 2026. Roughly 70% showed bets that were never placed on the live exchange. They were staged on dummy replicas of Polymarket, one hosted at "poiymarket.com," a capital "I" swapped in for the lowercase "l," close enough that nobody scrolling past would clock it. In 118 of the videos, creators celebrated about $900,000 in winnings. Those same positions on the real platform would have lost more than $166,000.

The creators were paid something like $2,000 to $3,000 a month by a marketing contractor called Virality, and told not to mention the arrangement. Some added "@polymarket partner" to their bios only after the Journal started asking questions. The part that stopped me was the rule for the "clippers" who re-shared the videos: they got paid only when at least 60% of their audience was based in the United States. Polymarket's main exchange has been legally barred from serving U.S. users since a 2022 CFTC settlement. The campaign was engineered to convert the exact people the company isn't allowed to take money from.

This ran at a convenient moment. Polymarket lifted the waitlist on its new U.S. platform in mid-May 2026, right as the fake-win campaign wound down. By late June the company was telling CNBC its annualized revenue had crossed $1 billion, with U.S. daily volume climbing from around $50 million in mid-May to more than $200 million by June 20. A feed full of strangers getting rich is a good way to warm up a market you're about to open.

The Winners Nobody Filmed

While the staged videos piled up views, real money was changing hands on Polymarket, won by people who had every reason not to post about it.

On April 23, 2026, the Justice Department charged Gannon Ken Van Dyke, a 38-year-old Army Special Forces master sergeant stationed at Fort Bragg. Prosecutors say Van Dyke helped plan and carry out Operation Absolute Resolve, the mission to capture Venezuelan president Nicolás Maduro. He opened a Polymarket account on December 26, 2025, and started betting YES on contracts like "U.S. Forces in Venezuela by January 31" and "Maduro out by January 31." He wagered about $33,034. In the predawn hours of January 3, U.S. forces took Maduro, the contracts resolved in his favor, and he cleared roughly $409,881.

The detail that stuck with me is in the cover-up. Prosecutors say Van Dyke asked Polymarket to delete his account on January 6, falsely claiming he'd lost access to his email, then moved his winnings through a foreign crypto vault into a new brokerage account tied to an email address that wasn't in his name. He'd created that address on December 14, nearly two weeks before he ever opened the Polymarket account. His trial is set for December.

A month later, prosecutors charged Michele Spagnuolo, a Google security engineer who traded under the handle "AlphaRaccoon." According to the complaint, Spagnuolo had access to an internal Google tool marked "Google Confidential" that tracked what people were searching for. Prosecutors say that from mid-October to early December 2025 he risked about $2.75 million on Polymarket markets tied to Google's "Year in Search" results, including a bet that the musician d4vd would be the most-searched person of the year. Polymarket had priced that outcome near zero, and the complaint alleges the public didn't yet know what Google's internal data had already told him. When the results went public on December 4, his account was up about $1.2 million.

Those are the two the government caught. Analysts have flagged more. The blockchain firm Bubblemaps, working with CBS's 60 Minutes, traced nine linked anonymous accounts that opened around the first U.S. strikes on Iran in late February, placed more than 80 bets on the timing of the strikes and a ceasefire, and won 98% of them for a combined $2.4 million. No one has been charged in that case.

Set all of it against the platform's own numbers. A separate Journal analysis of Polymarket data found that more than 70% of users lose money, and that 0.1% of accounts capture 67% of the profits. The typical user is down somewhere between $1 and $100; the bottom 10% of traders lose about $4,000 each. The kind of winner those videos sold you is mostly fictional, and the ones who were real had classified intelligence or a confidential corporate dashboard.

Who Benefits: The Case the CFTC Dropped

Two groups come out ahead here. The first is Polymarket. The fake-win campaign manufactured the look of organic, viral success right as the company was clawing its way back into the U.S. market it had been banned from. NYSE parent ICE has put around $2.6 billion into Polymarket, and Bloomberg reported the company was raising more at a $15 billion valuation. Nothing sells a valuation like a feed full of winners, even invented ones.

The second is the political operation wired into the company, and this is where the regulator walks in. Follow the dates. On July 15, 2025, the DOJ and CFTC jointly closed their only active investigation into whether Polymarket was illegally serving U.S. users, with no charges, reversing Biden-era scrutiny that had once included an FBI raid on CEO Shayne Coplan's home. About six weeks later, on August 26, Polymarket announced a strategic investment from 1789 Capital, the venture firm where Donald Trump Jr. is a partner, and said Trump Jr. would join its advisory board. He was already a paid strategic adviser to Kalshi, Polymarket's biggest rival, a job he'd held since January 2025.

Then the chair changed. Michael Selig was sworn in as CFTC chairman on December 22, 2025, after years at the law firm Willkie Farr & Gallagher representing crypto-industry clients. In February 2026, his CFTC filed an amicus brief siding with Crypto.com against the state of Nevada, arguing the agency's authority over prediction markets overrides state gambling regulators. Selig wasn't chairman when the 2025 case was dropped, so I won't pin that decision on him, but the amicus brief is his, and it sides with the industry against the states trying to regulate it.

The regulator got interested in the fake-bet campaign only after the fact. The CFTC's broader investigation into Polymarket's business and marketing was confirmed by CNBC on June 26, 2026, six days after the Journal story ran and around the time two senators started demanding answers. The two insider-trading prosecutions arrived the same way, largely out of Polymarket's own cooperation and referrals rather than proactive CFTC enforcement.

The Founder Called It a Feature

Polymarket isn't stonewalling every case. Coplan publicly thanked the DOJ for acknowledging the company's cooperation on Van Dyke, and the Spagnuolo prosecution came partly from Polymarket's own detection and referral. In March 2026 the company rolled out rules banning trades by anyone acting on stolen confidential information, illegal tips, or authority over an event's outcome.

Then there's what Coplan said out loud in November 2025: that it's "cool" the platform "creates this financial incentive to divulge information to the market." Read plainly, that's the founder calling insider knowledge flowing onto the exchange a feature of price discovery, not a bug, and that also describes almost exactly what Van Dyke and Spagnuolo did, minus the part where the information was classified or stolen.

So the two stories were never really separate. The staged videos sold retail users a picture of who wins on Polymarket: ordinary people, out in the open, holding up their screenshots. The people actually winning during those same months did it quietly, on information the rest of the market didn't have. One version was paid for; the other is the one Coplan calls a healthy incentive.

The Bottom Line

Event contracts aren't legally "securities," so the SEC stays out of this entirely. The CFTC is the only regulator with jurisdiction, which makes its posture the whole ballgame. On June 30, Senators Adam Schiff and John Curtis gave Chairman Selig until July 10 to answer six questions in writing, among them a blunt one: does the CFTC believe staged fake trades and simulated websites in promotional content are lawful without clear disclosure? That deadline is today.

The uncomfortable part is who's being asked. The person who has to decide whether Polymarket's deception crossed a line runs the agency that dropped Polymarket's last case. Its current chair came out of the industry's own law firms, and under him it has spent the year siding with prediction markets against the states trying to rein them in. Van Dyke and Spagnuolo are looking at years in prison for winning on information they weren't supposed to have. The company that paid to fake 140 million views of winning has announced an audit of its own marketing and is still lining up its next round of funding. Whether anything happens to it comes down to a regulator that has, so far, mostly looked the other way, and a Senate letter it can answer however it likes.