Two traders have filed a lawsuit against prediction market platform Polymarket and its CEO Shayne Coplan, alleging the unfair resolution of a market tied to Strategy’s (formerly MicroStrategy) Bitcoin sales. The plaintiffs, William Wood and another unnamed trader, claim the platform’s decision caused significant financial losses and violated the market's original terms.
The disputed market asked a binary question: would Strategy sell any Bitcoin by May 31, 2026? An SEC filing on June 1 subsequently revealed that Strategy had in fact sold 32 BTC worth approximately $2.5 million between May 26 and May 31. Despite the sale occurring within the deadline, Polymarket resolved the contract as “No,” arguing that public confirmation arrived after the market’s expiration. The resolution was upheld by UMA token holders during the dispute process.
The plaintiffs contend this violated the initial contract logic. They assert that Polymarket retroactively altered the market’s rules by adding language stating that confirmation outside the market period would not qualify. One plaintiff reported losses near $500,000, describing the outcome as a scam. The lawsuit brings charges of breach of contract, deceptive business practices, and false advertising, underscoring a growing tension between objective event outcomes and the platform’s discretionary settlement powers.
The case arrives at a pivotal moment for Polymarket, which recently secured a $2 billion investment from NYSE parent ICE and a partnership with DraftKings to launch regulated prediction markets. Legal experts warn that the outcome could set a precedent for how decentralized prediction platforms resolve ambiguous events. “Markets may begin pricing platform interpretations instead of actual events,” Galaxy researchers previously noted, a concern now central to the dispute.
