Polymarket on ZachXBT’s internal survey sees Meteora’s odds rise 44% in 24 hours as traders consider possible, as-yet-unproven informed positioning.
A Polymarket prediction market launched on February 23 asking traders to predict which cryptocurrency company on-chain investigator ZachXBT would expose for insider trading has itself raised questions about potential informed trading, according to social media posts and market data.
The market, titled “Which Crypto Company Will ZachXBT Be Exposed for Insider Trading?” ” was created after ZachXBT announced that a “major investigation” would be released on February 26 targeting “multiple employees who misused internal data for insider trading purposes” at “one of the most profitable crypto companies,” without naming the company.
Meteora, one of the multi-option market outcomes, went from a single-digit implied probability to around 44% within a day of the market’s launch, generating significant trading volume, according to market snapshots. The rapid price change sparked speculation about whether participants with non-public information were behind the change.
A user named Moritz posted to
Early market snapshots showed Pump.fun and Axiom as favorites, while Meteora registered a low probability. By February 24, Meteora had become the dominant outcome, according to market data.
The marketplace’s resolution criteria states that it will resolve the issue with the company “explicitly named by ZachXBT” in the expected February 26 release, with “official communications from ZachXBT” as the primary source of resolution, according to the terms of the contract.
Abrupt price movements in prediction markets represent positioning and order book dynamics, but do not constitute evidence of informed trading, market analysts note. The actual target of ZachXBT’s investigation will not be verified until the post goes live on February 26.
World Liberty Financial was among the market outcomes with a low implied probability. Its inclusion came on the same day that the company reported that a stablecoin briefly experienced volatility before recovering and said it had fended off a coordinated attack involving unauthorized access to the co-founders’ X accounts. No established causal link exists between these events and the stock market listing.
Polymarket’s resolution process is based on a proposed outcome, a dispute window and referral to the UMA dispute resolution process in the event of a dispute. UMA’s system uses token holder-led voting with validation and reveal periods.
Many past controversies have focused on the AMU’s resolution mechanisms. A Polymarket quiz on whether Ukrainian President Volodymyr Zelensky wore a suit answered “no,” sparking criticism of symbol-weighted voting dynamics and the apparent influence of whales. Another market on published files answered “Yes”, despite critics saying no confirming documents had been released. According to users of the platform, a previous mining transaction market was poorly resolved due to a governance attack by a WBU whale.
Polymarket US’s policy contains explicit prohibitions on trading of material non-public information by company personnel and its affiliates and restricts the use or disclosure of such information, according to platform documentation. The practical difficulty of controlling nonpublic information among pseudonymous external users on an international platform remains significant, compliance experts note.
U.S. lawmakers publicly linked prediction markets to insider trading risk in early 2025 after a suspiciously geopolitical event-related Polymarket win. A member of Congress has proposed legislation to combat insider trading in prediction markets. Investigations have found that prediction markets are vulnerable to betting on privileged or privileged information, particularly in geopolitics, according to congressional filings.
The contract is resolved based on ZachXBT names rather than deciding whether insider trading has occurred, which is operationally simpler than markets requiring evidentiary judgments, according to market design experts.
The February 26 release will determine which company ZachXBT nominates, if any. Until then, market observers say, the rapid market reassessment represents positioning dynamics rather than confirmation of informed trading in the prediction market itself.