The Commodity Futures Trading Commission (CFTC) has launched an investigation into Polymarket over allegations the company ran a misleading marketing campaign across social media platforms.
An investigative report carried out by the Wall Street Journal alleged Polymarket posted videos which appeared to show content creators celebrating successful trades on the platform.
Despite the videos appearing to be genuine, the newspaper claimed Polymarket made near identical copies of its website, instructing the content creators to simulate trades on the duplicate sites without revealing they were being paid to do so.
A Polymarket spokesperson told news outlet CNBC: “We are conducting a comprehensive audit of active promotional content to ensure it complies with our standards, as well as applicable regulatory and legal disclosure requirements.”
In addition to the CFTC investigation, Polymarket, which operates on the Polygon blockchain as a decentralised prediction market outside the US, has been hit by phishing attack which led to the theft of $3.1m worth of the platform’s PUSD token.
Having affected 11 wallets, Polymarket discovered a third-party vendor had been compromised, with the hackers implanting a malicious script into the frontend for some users.
Numerous blockchain intelligence firms reported that the stolen assets were taken from the Polygon blockchain and “bridged” to the Ethereum network.
Polymarket acknowledged the incident in a post on X on 25 June, assuring that it had contained the breach and that all victims would be refunded in full.
The double blow of negative headlines comes as the platform recently revealed to CNBC that its annualised revenue has surpassed $1bn in the US.
The milestone was hit six weeks after the firm lifted the waitlist for its US-based exchange, which operates separately from its international arm.
Weekly trading volume on the platform has been boosted by the FIFA World Cup, which kicked off on 11 June.
Polymarket was previously banned from operating in the US for not properly registering with the derivatives regulator, yet it made a return to the market with a soft launch in December 2025 after shelling out $112m to acquire CFTC-licensed exchange QCEX.
The CFTC, alongside the US Department of Justice, dropped its investigation into the company without charges in July last year.
Nevertheless, Polymarket has been the subject of scrutiny from state sports betting regulators over the past few months.
In addition to being denied a temporary restraining order against the Michigan Attorney General (AG) in March, Rhode Island AG Peter Neronha filed lawsuits against Polymarket and rival Kalshi in May over “unlawfully” offering sports betting in the state.
Outside the US, Polymarket was issued a cease-and-desist order by the Dutch gaming regulator in February, before being blocked in Brazil in April due to a country’s ban on prediction markets.
Polymarket was also blocked in Spain in May after the country’s gaming regulator and the government initiated disciplinary proceedings against the platform and Kalshi.
The post Polymarket faces CFTC probe amid $3.1m hacking scandal first appeared on EGR Intel.
Prediction market the subject of an investigation by the derivatives regulator over potential marketing violations, as platform also manages the fallout of a phishing attack targeting user funds
The post Polymarket faces CFTC probe amid $3.1m hacking scandal first appeared on EGR Intel.