Polymarket faced renewed criticism after traders said the prediction market platform changed settlement terms in a $3.8 million dispute involving Strategy’s Bitcoin sales.
The contested market asked whether Strategy, formerly linked to the MSTR ticker, would sell any Bitcoin by May 31.
Strategy later disclosed that it had sold Bitcoin during the week before that date. However, Polymarket rejected the “Yes” outcome because the company disclosed the sale on June 1, after the market’s stated cutoff.
The ruling affected 1,838 accounts that had collectively risked $3.8 million. Traders who backed “Yes” argued that the actual sale date should have determined the result, not the public filing date.
Late Wording Change Draws Trader Anger
Hunter Guo, a 20-year-old student at King’s College London, was among the affected traders. He bought thousands of “Yes” contracts while the market remained open after Strategy’s disclosure. He expected a profit of about $35,000 and briefly considered using the money to buy a Porsche.
Minutes later, the value of his contracts dropped close to zero. Guo later said, “I cried for two days. It’s a lot of money.” He is from China and studies digital media and culture in the United Kingdom.
Polymarket later issued additional clarification on the settlement terms. It said the “YES outcome of the prediction will be awarded in case of public disclosure of the trade before 11:59 p.m. ET on 31 May 2022.” Under that interpretation, Strategy’s trade did not qualify because the filing arrived after the deadline.
Clarification Process Comes Under Scrutiny
Guo has continued to challenge the result publicly. He posted repeatedly on X using #StopPolyScam and submitted complaints to United States regulators and law enforcement. He also used AI tools to create a website where other affected traders could report losses and organize complaints.
The case has increased attention on how prediction markets handle clarifications. Such updates are used when an event does not fit neatly into a yes-or-no contract. Traders said the concern was not clarification itself, but the timing of new language after money had already been committed.
Price Gaps Highlight Settlement Risk
Prediction contracts trade like odds. A “Yes” share priced at 60 cents suggests a 60% chance, while a “No” share at 40 cents suggests 40%. The winning side pays $1.
Traders often compare similar markets on Polymarket and Kalshi. In March, Kalshi priced Gavin Newsom at 29% for the 2028 Democratic presidential primary, while Polymarket priced him at 24%.
Such gaps can support arbitrage strategies across platforms, including DraftKings and Flutter Entertainment’s FanDuel. However, the Strategy dispute shows that settlement wording can decide whether an apparently profitable trade survives final review across competing markets during the final settlement process for many affected traders.
