According to Foresight News, analysts from blockchain companies Chaos Labs and Inca Digital found rampant wash trading on Polymarket. They discovered signs of deceptive trading activity on Polymarket, where buying and selling often occur simultaneously and repeatedly to create the illusion of trading volume and activity. Chaos Labs found that fake trades account for about one-third of the trading volume in the U.S. presidential election market on Polymarket, while Inca Digital found that a 'large portion of trading volume' in the market may be attributed to potential fake trades.
Chaos Labs and Inca Digital found that the reported trading volume of presidential election predictions on the Polymarket website does not match on-chain data. Inca estimates that the actual trading volume of the presidential election prediction market is around $1.75 billion, while Polymarket reports a figure of $2.7 billion. Chaos Labs attributes this to Polymarket conflating trading shares with dollars.