Key Takeaways:
- Polymarket said it has terminated its Chief Marketing Officer, Matthew Modabber, following an internal investigation of several sweeping marketing moments.
- One episode, a spurious promotion for a ‘fake trade,’ is under scrutiny by the U.S. Commodity Futures Trading Commission.
- The change follows a week of red flags from Polymarket as it raised $1 billion, valuing itself at $21 billion.
Polymarket reportedly has shed one of its early top executives as the crypto prediction market looks to step out of the startup marketing playbook. According to the New York Post citing sources, Matthew Modabber, the chief marketing officer since January 2024, was fired in the wake of an internal investigation.
Polymarket CMO Exit Follows Marketing Controversies
Modabber is a company that we saw calling out on some promotional methods, such as staged videos that suggested a user could make money through such trades as didn’t actually exist.
Polymarket earlier stated it would be maintaining accurate, fair and transparent markets and would be considering its promotional material. The internal review also examined reports that influencers were paid through a personal PayPal account, sometimes without clear sponsorship disclosures, according to the New York Post.
Read More: Polymarket Perps Beta Goes Live for 24/7 Trading
Modabber Helped Drive Polymarket’s Explosive Growth
On Linkedin, Modabber identified himself as Polymarket’s 11th employee, and claimed to have launched a marketing, growth and partnerships program that has since grown to include over 50 individuals and brought daily volume from around $300,000 to the mid-nines.
His long tenure with the CEO Shayne Coplan is said to have made the choice a difficult one. The two were acquainted in high school and according to sources, Coplan had resisted attempts to oust him prior to finally agreeing to part ways. Neither Coplan nor Modabber publicly commented on the report.
$21 Billion Valuation Raises the Stakes
The move will mark a change in leadership for Polymarket in critical times. In August, the blockchain-based prediction market raised $1 billion in a funding round led by 1789 Capital, giving the company a $21 billion post-money valuation.
That valuation comes with increased expectations of a large financial platform to operate with compliance, financial controls and governance, as opposed to that of an early stage crypto start-up.
This week Bloomberg also broke news that investors such as Founders Fund had previously urged Polymarket to increase financial checks as it grew.
Prediction Market Scrutiny Keeps Building
The rapid pace of growth has brought crypto prediction markets more under the spotlight. Legislators have raised concerns about practices and potential insider trading in both event-betting clubs and the CFTC is monitoring the sector.
Kalshi has also been seeing greater competition from Polymarket, both of them vying to grab main-stream demand for event contracts. For Polymarket, Modabber’s reported exit signals a shift toward tighter oversight just as the company is trying to turn massive crypto-driven growth into a more mature financial-market business.
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