FBI Raids Home of Polymarket CEO Shayne Coplan

Obviously there are no details yet, but I suspect it's as simple as:

- Polymarket is still very illegal in the US

- Lol. We all know it's easy to get around that

- If the CEO knew or was complicit in US citizens breaking laws, he could be in trouble. And if there was evidence he was encouraging it, he could be in big trouble

Can someone explain to me how this is? It's a company HQ'd in New York, but it's not allowed to do business in the very country it's HQ'd in? What am I missing?

As I understand it (very much not a lawyer), the company complies with US laws by not allowing people in the US to use it, so there’s no issue doing business.

Kalshi got the goahead from an appeals court to list election bets. I think Robinhood added election bets soonafter. Is there a reason that wouldn't apply to Polymarket? Granted, Polymarket was operating before that ruling.

https://www.reuters.com/legal/us-federal-court-upholds-rulin...

The CEO or the company can only be in trouble if they are found guilty in court. That's not going to happen in the next two months, and Trump probably couldn't care less about this.

What rake did I just step on? I'm getting downvoted for this.

I think it's the perception that your comment assumes that the accusations by Polymarket that the Biden admin are targeting them for predicting Trump are true.

Has nothing to do with elections and all to do with being an unregulated market that has zero KYC.

Even if election bets are legal, the betting market is still highly regulated.

The standard is (a) whether the act was illegal, (b) the company knew it was illegal and did it anyway.

None of what you listed is relevant since it isn’t illegal for example to suppress speech or mislead the public.

You're not missing anything — that's exactly how it is. There's nothing that stipulates that US companies must sell to other US companies, and it's a great place for investments & startups, so even if Polymarket isn't licensed to operate in the US it still makes sense for them to be there.

I see. Well that was not my intention here.

The Wall Street Journal version of the OP article seems to indicate that the ruling did not apply to Polymarker due to it’s settlement with the CFTC in 2022 - but the language used is a little unclear:

> Polymarket has blocked access to Americans since 2022, following a settlement with the Commodity Futures Trading Commission, which accused the company of running an unregistered derivatives-trading platform. Traders say the ban on U.S. users can be circumvented using virtual private networks.

>Election betting was legalized in the U.S. under a recent federal court ruling, but only for CFTC-regulated markets, so Polymarket has remained off-limits to Americans.

https://www.wsj.com/us-news/law/fbi-polymarket-ceo-investiga...

The first amendment of the US constitutions says that it's illegal for the government to make a law which abridges people's freedom of speech. There are many cases of government entities working with social media companies to suppress speech as the Twitter Files have proved. As the government created and upholds those federal entities on the basis of laws, the government is responsible.

No the first amendment says:

Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.

It was like this for fireworks in the past too. Used to go to Pennsylvania where it used to be illegal for PA residents to purchase them, they'd check your drivers license when you came in to validate it was from elsewhere and issue a 24hr transport permit to get it out of the state. Naturally the fireworks shops were mostly near state borders.

Trump not caring will mean the case proceeds. Why would they drop it?

If you’ll humor me - what specifically did the Twitter files show in that regard?

> The standard is (a) whether the act was illegal, (b) the company knew it was illegal and did it anyway.

Allegedly...

You can do it, but it's an incredibly foolish way to operate, as the CEO is finding out.

The constitution does not make anything a crime

Would scream civil instead of criminal.

Except treason.

> and it's a great place for investments & startups, so even if Polymarket isn't licensed to operate in the US it still makes sense for them to be there.

Well, maybe for startups in general, but it apparently didn't work out for Polymarket. Also, it's probably a better case if you're just not targeting US customers, rather than being actually forbidden from trading with US customers.

Kalshi is allowed to offer Futures under supervision of the CFTC[1]. The CFTC had previously said that prediction markets are not futures (they claimed they are illegal gaming), and Kalshi sued to get a ruling that they are futures.

Polymarket has avoided coming under regulation by the CFTC by avoiding US users. For their markets to be legal under current regulations they'd have to have all their markets approved by CFTC.

[1] https://kalshi.com/blog/article/how-is-kalshi-regulated

I'm not in the US, but as far as I know about the country the legal system there keeps running whether the current US President cares about individual cases or not...

US Cellular <https://en.wikipedia.org/wiki/U.S._Cellular>, the US's fifth-largest mobile service provider, as of 2012 no longer operates in its headquarters city of Chicago. <https://www.prnewswire.com/news-releases/us-cellular-to-sell...>

The person who financed the vice president is a major investor in Polymarket.

The part where Elon's mum said she was shocked by the contents of the Twitter files and that's why she stopped being a democrat. That's all the info I needed.

Haha. How leftist/neoliberal of me to outsource my opinion! Well, in my defence, Elon's mum is more trustworthy than CNN. She hasn't lied yet.

Unlike your typical leftist, I actually keep score of such things.

Such cases would be pursued by DOJ or FCC or some other federal agency that the President has 100% control over. If the president asks to drop the case, it will be dropped.

Yes, because Polymarket offers sports markets, which are still illegal in the US (for US users, anyway). Kalshi has been careful to offer markets in basically everything except sports.

It should be obvious what happened here: Polymarket has been offering grey or black markets to users, using only IP address as the discriminator, which is very easy to work around. They've operated under the Feds' radar for quite some time, and the Feds noticed them after they started getting significant press regarding the election.

The election is the reason they got noticed, but the likely crime itself is sports, not elections.

He would have to care about the case to bother doing so…

States like money. If you're complying with local laws and regulations then why wouldn't they want the tax revenue?

Fireworks are illegal in NY and have been illegal in PA for much of the past two decades. Despite this, the border is crawling with fireworks stores. PA made it illegal to sell fireworks to PA residents, but totally legal to sell to residents of neighboring states provided they immediately transport them over state lines.

> some other federal agency that the President has 100% control over

Neither Civil Servants nor Senior Executives can be directly terminated by the President without due process. Only appointees can be fired on a whim, and their replacements must be confirmed by the Senate. The only exception to this is "recess appointments" made when the Senate is not in session, but those appointments are temporary, and Congress can stay in session as long as needed (until the next seating after an election) to block these as long as both Houses agree to do so.

Many federal agencies today are actually governed by boards of commissioners, with limits on the number of them that can be from the same party.

From what I can gather online, US citizens can indeed legally bet on elections: https://www.nbcnews.com/politics/2024-election/election-bett...

> If the CEO knew or was complicit in US citizens breaking laws

the frontpage being almost exclusively about US politics is kind of a giveaway

Sort of. It’s more of a limit on what the crime of treason can be.

An unrigged market like Robinhood*