Google Engineer Charged Over Alleged Polymarket Insider Trading
Polymarket is a prediction market where event contracts are traded using crypto assets, with prices reflecting the crowd’s assessment of the probability of an outcome. Google publishes its annual “Year in Search” rankings, and nonpublic data can directly determine the outcome of related contracts. The case is the second criminal prediction-market insider trading case brought by federal prosecutors in the Southern District of New York in 2026, highlighting concerns about equal access to information in emerging markets.
Federal prosecutors in the Southern District of New York and the Commodity Futures Trading Commission alleged that Google engineer Michele Spagnuolo used internal search data to place bets on Polymarket under the username “AlphaRaccoon” between October and December 2025. He made more than $1.2 million after the rankings were released on December 4. Spagnuolo was arrested on May 27, 2026, and faces charges including commodities fraud, wire fraud and money laundering.
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The history behind this eventPolymarket Faces Insider-Trading Suspicions After Bets on ZachXBT Probe Yield More Than $1 Million
Polymarket allows users to wager crypto assets on event outcomes. Although its onchain transactions are publicly visible, the offshore platform does not require identity verification. After onchain investigator ZachXBT said he would expose insider trading at a crypto company, a market opened for users to guess the company’s identity. Ironically, advance information may itself have leaked in the market betting on an insider-trading investigation.
On Feb. 26, 2026, ZachXBT identified Axiom as the subject of the investigation, alleging that its employees may have misused internal tools to track users’ wallets. The prediction market had recorded about $40 million in trading volume since Feb. 23. Lookonchain found that at least 12 newly created wallets had bet on Axiom in advance, earning more than $1 million in total, including $411,000 for one wallet. Axiom has revoked the relevant access and is investigating a possible leak.
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