(Bloomberg) -- Many people involved in crypto markets had reason to gloat on Wednesday about Donald Trump’s win, but one closely watched French trader’s bets are poised to pay out millions of dollars on the election’s outcome.
The pseudonymous trader — known best as Fredi9999, the username of one of his four known accounts on the Polymarket predictions platform — is expected to haul in a total profit of around $48 million on the results of the election, according to calculations made by Bloomberg.
In the platform’s most-popular market, where users bet on which candidate will be the next president, the four accounts will net around $22 million, Polymarket data showed on Wednesday morning in New York. Another $26 million was the result of other bets related to the election, such as Trump winning the popular vote or winning Pennsylvania. Two of the trader’s accounts rank first and second place as Polymarket’s most-profitable users of all time.
Scrutiny of Fredi9999’s trading patterns ramped up in recent weeks as his bets ranked among the largest wagers on Polymarket’s presidential markets, prompting concerns of possible market manipulation. Following an investigation, Polymarket said the person behind the four accounts is a French national with extensive experience in financial services, who simply wished to bet on Trump’s chances.
On Polymarket, which does not permit US users, traders use cryptocurrency to buy what it calls “yes” or “no” shares tracking outcomes of future events. The amount of buying and selling of those instruments then determines the implied probability of each outcome at any point in time. The platform displays profits under each account’s positions, which represent the difference between the price of the shares when they were bought and $1.
While polls had been showing a neck-and-neck race between Trump and his Democrat rival Kamala Harris in the days leading up to the vote, betting markets swung heavily in favor of the Republican. Polymarket had been a particular favorite for Trump supporters, often displaying probabilities of his victory that were several percentage points higher than other prediction markets.
In comments published by his accounts on Polymarket, the trader described himself as a European investor, statistician and “big gambler” who was willing to bet millions on Trump’s chances. “A land of the free, a home of the brave, not a KAMALA LA LAND. She is WEAK!!” he wrote on Oct. 6.
The trader said in other comments that he viewed most traditional polls with caution, given how outcomes were misjudged in previous presidential elections. Instead, prediction markets offered the best risk versus reward. Even then, Polymarket wasn’t his preferred way to wager, just a portion of his bets, he said.
“Best play is Bitcoin,” the trader said on Oct. 18. “So do you think that I care about manipulation the odds here ??”
©2024 Bloomberg L.P.