Coinbase CEO Brian Armstrong spoke out against the Department of Justice’s investigation into Polymarket, a crypto prediction market platform with strong ties to Coinbase. The two companies have a history of collaboration, including shared investments and working together on regulatory issues.
In a now-deleted X post, Armstrong expressed concern about the DOJ’s actions, which he views as politically motivated. He also suggested that the investigation could ultimately benefit Polymarket.
The DOJ has reportedly initiated a probe into Polymarket for allegedly allowing trades from US-based clients. The Federal Bureau of Investigation (FBI) searched the Manhattan apartment of Shayne Coplan, CEO of Polymarket, taking his phone and electronic devices.
Ryan Seam Adams, co-founder of the technology podcast Bankless, expressed alarm over the FBI’s raid on Shayne Coplan. Adams said the authorities did not give a reason for the raid, calling the action a form of political revenge that is extremely intimidating.
In response to Adam’s message, Armstrong revealed that he had deleted his prior post on the authorities’ investigation of Polymarket as he did not have full details on the matter. However, he added that based on what he knows, the situation seems troubling.
Notably, Polymarket was supposed to prevent US-based users’ trading activities as per a 2022 agreement with the Commodity Futures Trading Commission (CFTC). The platform became very popular during the US election days, predicting accurate political outcomes, as users bet on their preferred candidates.
Read also: Harris Skips Crypto Regulation as Trump Leads Polymarket with 52%
A French trader’s whale transaction through the final election days added more scrutiny into the platform as opponents claimed that Polymarket allowed the manipulation of the underlying market. Polymarket responded to the authorities’ claims, defending the platform is a tool for people to learn about updates, including elections.
Denouncing the authorities’ actions as politically motivated, Polymarket stated that it would fight for justice, adding that Polymarket is a “fully transparent” prediction market that helps everyone to understand global events.
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