Spotify Demands Kalshi and Polymarket Remove Branding Over Manipulated Streams
Spotify has asked prediction market platforms Kalshi and Polymarket to remove its logo and clarify they have no official partnership. The move comes after users manipulated song streams to win bets on music charts.
Manipulated Streams Boost Song Rankings
The streaming giant removed over 500,000 artificial streams that pushed Malcolm Todd’s song “Earrings” up the US charts. These inflated numbers were used to settle a Kalshi market on the most-streamed song in June.
The market attracted $3 million in trading volume. Malcolm Todd was declared a winner based on the manipulated figures before Spotify completed its investigation.
Prediction Markets Under Scrutiny
Spotify contacted both Kalshi and Polymarket after discovering the issue. Kalshi is now investigating the incident, while Polymarket has not yet commented publicly.
Prominent trader Caleb Davies criticized Kalshi for failing to address suspicious activity early and shifting blame instead of protecting users.
Why This Matters
Bitcoin bounced from midweek lows near $57,700 and reclaimed the key $60,000 level. Ether performed even better, gaining nearly 10% from its recent lows while comfortably holding above $1,500 support.
The rebound comes just before the US Independence Day holiday, when trading volume is expected to remain thin.
Bitcoin ETFs See First Inflows in Over a Week
This case highlights a growing risk in prediction markets — bettors now have strong financial incentives to manipulate real-world events they wager on.
Similar incidents have occurred before, including tampering with maps for war-related bets and weather data for temperature markets.
Options Market Calms Down
Implied volatility dropped sharply after the jobs data. Front-end at-the-money volatility fell from the mid-40s to the high-30s. The options term structure returned to contango, favoring volatility sellers.
Downside protection remains in place but is less expensive than during the peak of the selloff.
Low Odds Turned into Big Profits
Before the suspicious streams began, Kalshi’s odds of Malcolm Todd topping the June chart were under 3%. Traders who bought early stood to make roughly 30 times their investment.
Spotify’s Response
Spotify says it actively fights stream manipulation and does not pay royalties on artificial streams. A spokesperson noted that all major streaming platforms face this ongoing challenge.
The story was first reported by WIRED and later picked up by Bloomberg.
