New York City Council investigates Polymarket for predatory marketing to young investors.
The New York City Council has opened an investigation into the marketing practices of Polymarket, the leading predictive markets platform in the United States. The initiative comes from Council Speaker Julie Menin, who accused the startup and other companies in the sector of exploiting young investors with predatory advertising strategies.
The accusation was formalized in a letter sent to Polymarket's CEO, Shayne Coplan, dated Tuesday (August 11). The document also mentions other platforms in the sector, such as Kalshi, Coinbase, and Gemini Titan, in relation to the same allegations of targeted marketing to young users.
According to the letter, Polymarket allegedly paid digital influencers without disclosing this commercial relationship, produced videos with fictitious negotiations on websites created to mimic its platform, presented lost bets as winners, and encouraged the use of insider information. The document cites press reports as the basis for the allegations and claims that the company worked with marketing agents and social media influencers to target young adults and potentially minors with false and misleading advertising.
Business model under scrutiny
Platforms like Polymarket allow users to bet on contracts for events in politics, sports, and entertainment. The sector has grown rapidly in recent years and has gained a broad base of participants. Critics, however, argue that these platforms essentially function as gambling and carry risks associated with the use of insider information and addictive behaviors.
The City Council investigation could represent a test for Polymarket and other predictive platforms, which have been defending their business model before state regulators who are challenging event contracts, including those related to sports.
Polymarket is regulated by the U.S. Commodity Futures Trading Commission (CFTC). In early 2026, the CFTC filed a lawsuit against the state of New York, alleging that it usurped federal authority by prosecuting predictive markets companies based on gambling laws.
In response to the investigation, a Polymarket spokesperson stated in a press release sent to Reuters that the company is “eager to engage in dialogue with the New York City Council on this matter.” The Council has given Polymarket 14 business days to respond to questions about its use of social media, influencers, and content creators in its marketing campaigns.
