Eight crypto wallets generate $1.2M in profits from ZachXBT Axiom investigation bets amid insider trading allegations
Eight wallets dominated Polymarket profits by wagering over $1.2 million on an investigation into Axiom by ZachXBT, sparking insider trading debates within the blockchain research community.
A select number of cryptocurrency wallets generated profits exceeding $1.2 million by placing wagers on a Polymarket betting contract connected to an onchain probe into Axiom, a decentralized finance (DeFi) trading platform, sparking renewed worries that prediction markets may be providing financial rewards to individuals possessing insider information about significant market announcements.
According to trading information gathered on Dune, the eight wallets that proved most profitable within the market earned approximately $1.2 million in total. The identical dataset reveals that more than 50 different wallets recorded combined losses totaling roughly $1.23 million, with two specific wallets suffering losses of approximately $366,000.
According to onchain analyst Defioasis, eight of the ten most profitable wallets appear to be insider addresses based on their onchain transaction behavior patterns. In a Friday post on X, the researcher stated, "There are 3 addresses that achieved profits exceeding $100,000, all of which are insider addresses that traded only this single market."
On Thursday, ZachXBT published the highly anticipated investigation, making allegations that Broox Bauer, an employee of Axiom, along with other parties, engaged in insider trading activities beginning in early 2025.
Responding to the situation on X, Axiom expressed being "shocked and disappointed" by the revelations and announced that access to the tools allegedly utilized for the insider trading activities had been terminated.
Prediction markets raise insider trading allegations
Concerns regarding insider trading within prediction markets escalated in early January following a remarkably profitable wager on the ousting of Venezuelan President Nicholas Maduro by the US that attracted significant attention.
A Polymarket user placed a wager on Jan. 3 on a contract forecasting that Maduro would be ousted from power mere hours before US military forces apprehended him during a military operation, yielding approximately $400,000 in profits for the account holder.
Subsequently, US legislators have put forward legislation designed to limit political prediction market participation by government officials, intensifying the regulatory focus on this industry sector.
Polymarket faces growing regulatory scrutiny on gambling concerns
Polymarket, which stands as the largest decentralized prediction market platform, has encountered increasing regulatory challenges across multiple nations where governmental authorities have contended that the platform provides unlicensed gambling services.
In January, both Hungary and Portugal restricted access to the platform, pointing to concerns regarding prohibited gambling operations.
One week prior, Ukraine implemented a block on Polymarket, categorizing its operations as unlicensed gambling according to the country's national legal framework.
Additional countries have also imposed restrictions or outright bans on Polymarket due to gambling-related concerns, including France, Belgium, Poland, Singapore and Switzerland.