NEW YORK--(BUSINESS WIRE)--#blockchain--Solidus Labs, the leader in multidimensional market integrity and trade surveillance, released today its latest research report, titled Polymarket Under the Polygraph: Market Abuse in the Age of Onchain Prediction Markets. The report provides a forensic investigation into the structural risks of onchain prediction markets, revealing evidence of cross-symbol wash trading, extreme profit concentration, and multichain insider-trading patterns that threaten the long-term integrity and investor trust of these rapidly scaling markets.
Solidus Labs utilized its HALO surveillance platform alongside advanced investigative analysis to uncover these patterns, identifying manipulation schemes often invisible to legacy monitoring tools:
- Multichain Insider Trading: Advanced forensics identified clusters of proxy wallets using multichain bridging to mask their identities while exploiting non-public information on geopolitical and crypto-native events.
- Massive Wash Trading: Solidus flagged $253 million in gross notional wash trading in the 2024 US Election market, representing 15% of all traded volume.
- Novel Manipulation Tactics: The report documents "cross-symbol wash trading," a prediction-market-specific tactic used to generate volume inflation via "riskless" delta-neutral positions on mutually exclusive outcomes.
- Extreme Profit Concentration: The report reveals that less than 1% of wallets captured nearly 50% of profits in the Politics category, suggesting systemic informational or infrastructural advantages.
"Onchain prediction markets carry immense promise when it comes to trading on the future and transforming capital markets, but they also dramatically increase the risk surface for manipulation and the complexity of detecting it," says Asaf Meir, Founder and CEO of Solidus Labs. "These risks are happening at scale in live markets with real, significant monetary implications to investors and consumers. Addressing these complexities requires surveillance technology built from the ground up for the unique challenges of onchain prediction markets - pseudonymous, multichain, and event-driven."
The findings are based on extensive forensic analysis of public onchain data from Polymarket’s decentralized, global platform. By combining real-time signals from Solidus Labs’ HALO platform with deep-dive investigative forensics, this report offers a transparent, data-driven look at the current state of onchain market integrity. As these markets continue to scale, this analysis serves as a critical resource for regulators, market operators, and financial institutions to better understand, detect, and deter emerging forms of abuse.
Download the full report here.
About Solidus Labs
Solidus Labs is the gold standard for multidimensional trade surveillance and market integrity solutions for modern financial markets, across any venue, product, or asset class.
Contacts
Media contact:
soliduslabs@gregoryfca.com