One of the leading Polymarket whales injected another $7M into Trump’s ‘Yes’ tokens, betting on an election victory. As bets are heating up, market manipulation and risky positions are also becoming more visible on the betting platform.
Whale activity on Polymarket accelerated in the past few days, with a mix of true believers and suspected market manipulators. One of the latest supporters of Trump’s victory continued to buy ‘Yes’ tokens with a new $7.03M deposit from Kraken. The new inflow of funds adds to the $70M spent by whales in supporting the potential Trump victory.
The whale has an estimated $714K unrealized loss after Trump’s ‘Yes’ tokens slid from $0.66 down to $0.61.
This account is a holder, but there are other traders actively pushing down the betting price on Trump’s victory. Some of the accounts are even selling at a loss, causing a trend reversal and added volatility.
Want to know why Kamala Harris is trending up on Polymarket?
Right now a bunch of no named accounts are generating activity, SELLING AT A LOSS!
Across multiple betting avenues they're manipulating the odds and creating downward pressure for Trump & GOP, and upward pressure… pic.twitter.com/DVpVyN2QgM
— BUNK (@wrongsns) October 31, 2024
Additional market pressure comes from arbitrage opportunities, with cross-selling possible on different betting markets. Traders recently noticed the Kamala Harris ‘Yes’ tokens were valued higher on PredictIt, leading to further market manipulation. The most recent trades show that Polymarket is not a reliable predictor of the true outcome of the US election.
Polymarket faces multiple betting pressures
Polymarket is still not considered an official prediction, as there are doubts about wash trading. In the past week, one buyer rushed enough orders to put Trump’s odds to 99%, costing around $3M. Currently, price pressures require much higher bids to sway the market.
The profile of traders betting on a Trump victory is different from that of the Kamala Harris side of the bet. Most of the Trump bets are concentrated through whale wallets. Bets on the opposite side are more widely distributed with small-scale buyers.
To further complicate the picture, some of the small-scale users on Polymarket may be airdrop farmers, expecting the platform will consider launching its native token. Up to 44% of Polymarket bets are under $50 and may be considered small-scale betting or outright airdrop mining. But it is the 0.01% of bets above $100K that have the biggest effects on the market and sway the chart the most.
The past month saw no lack of new users of every size, ready to bet on one of the biggest pairs in Polymarket’s history. In October, Polymarket added a total of 300,386 new accounts.
Open interest also went vertical at more than $358B for all markets. Of that open interest, up to 91% went to US election issues as of October 14, contracting slightly in the past two weeks. Despite this, whales with convictions still hold their positions, even with big unrealized gains.
Among the top 10 holders, only three hold unrealized gains, with the rest still waiting out the turbulence. At least four accounts are associated with Fredi9999, one of the top traders on Polymarket, and they reveal a mix of unrealized gains and losses.
Top trader on Polymarket not politically motivated
The identity of Polymarket’s top betting whale on the US elections has been confirmed as a French trader motivated by mathematics and odds more than by politics. The whale, whose biggest account Fredi9999 is at the top of the leaderboards, confirmed his identity for the Wallstreet Journal.
The trader, identified as a French national and going by the name of Theo for the Journal’s piece, said he was not politically motivated. He was also not trying to sway the perception of the elections, but he was confident in beating the odds. The Polymarket whale stated he only used personal funds to make the bets, though with no independent confirmation on the funding source.
The trader’s main intent is just to make money, which at least the lead Fredi9999 account achieved. After favorable buying, the account holds more than $1M in unrealized gains. At the same time, the bets made on a popular vote and electoral college win could erase $30M in positions if the elections go against Theo’s bets. At this point, Fredi9999 and all the related smaller accounts can hardly start unwinding their positions without sparking a market-wide panic and crashing the odds.
