The AlphaRaccoon Scandal: $1M Insider Trading on Polymarket

In December 2025, a Polymarket trader known as "AlphaRaccoon" (wallet 0xafEe) made headlines after winning 22 out of 23 bets on Google's Year in Search results, netting over $1.19 million in profit. The suspicious accuracy—including a $200,000 win on an obscure singer with 0.2% odds—sparked immediate allegations of insider trading. A Meta engineer publicly claimed Google "accidentally pushed results early," while Polymarket's CEO defended the trader, stating insider trading is "not prohibited" and even "cool" because it incentivizes information flow. This scandal represents the largest alleged insider trading case in prediction market history.

The AlphaRaccoon Trades: What Happened

The trader deposited approximately $3 million into Polymarket before systematically betting on Google's 2025 Year in Search rankings—a market predicting which people, events, and topics would top Google's annual search trends report.

The Most Suspicious Bets

• Pope Leo XIV bet: Won $1,068,000 betting the Pope would NOT be the most-searched person—a contrarian position that required specific knowledge
• d4vd bet: Turned $10,647 into ~$200,000 betting on an obscure R&B singer at 0.2% odds to appear in top searches
• 22/23 accuracy: Statistical probability of this accuracy by chance is approximately 0.00001%
• Timing pattern: Bets placed shortly before Google published official results

The wallet had previously won $150,000 correctly predicting the exact launch day of Google Gemini 3.0, further suggesting access to inside information from Google.

The Meta Engineer's Accusation

Jeong Haeju, a Meta engineer, posted on X (formerly Twitter) claiming that Google "accidentally pushed the Year in Search results early" before officially publishing them. According to Haeju, this early data leak would have given anyone monitoring Google's systems advance knowledge of the results.

Google has not officially responded to these allegations. The timing of the bets relative to any potential data leak remains under investigation by community analysts.

Polymarket's Controversial Response

Rather than investigating or condemning the suspicious trading activity, Polymarket's leadership took a surprising stance. CEO Shayne Coplan has consistently maintained that insider trading is:

• "Not prohibited" under Polymarket's terms of service
• "Cool" because it incentivizes people with information to share it via markets
• Different from securities because prediction markets aren't regulated the same way

This position has drawn significant criticism from traders who feel disadvantaged competing against insiders, and from regulators watching the prediction market space closely.

Why This Matters for Traders

The AlphaRaccoon scandal has major implications for anyone tracking smart money on Polymarket:

1. Information Asymmetry is Real

This case proves that some traders have access to information you don't. Markets aren't always efficient—they can be gamed by those with privileged access.

2. Whale Tracking Becomes Essential

If insiders are trading, identifying and following their wallets before results are announced could be profitable. Tools that detect unusual betting patterns are more valuable than ever.

3. Certain Markets Are Higher Risk

Markets based on corporate announcements (like Google Year in Search) or proprietary data are more susceptible to insider trading than political or sports markets where outcomes are harder to know in advance.

How to Detect Similar Insider Activity

Using PolyTrack, you can identify potential insider trading patterns:

• Watch for new wallets making large, confident bets: AlphaRaccoon deposited $3M and immediately went big on obscure outcomes
• Track win rates above 90%: Sustained accuracy this high is statistically improbable without edge
• Monitor corporate announcement markets: These are more likely to have insiders than political markets
• Look for timing patterns: Bets placed hours before announcements are suspicious
• Check wallet history: Previous "lucky" wins on related markets (like Gemini launch) suggest systematic access

The Broader Implications

For Prediction Markets

The scandal raises fundamental questions about market integrity. If insider trading is openly permitted and even celebrated, retail traders may lose confidence in the fairness of markets. This could harm liquidity and adoption long-term.

For Regulation

With Polymarket's recent CFTC approval for US operations, regulators are watching closely. Cases like this could prompt stricter oversight or rules against insider trading in prediction markets.

For Traders

The lesson is clear: assume some traders have better information than you. Focus on markets where you have genuine edge, use whale tracking strategies to follow informed money, and avoid betting against suspicious large positions.

What Happened to AlphaRaccoon?

As of December 2025, the wallet remains active on Polymarket. No enforcement action has been taken, and the profits have not been clawed back. The trader has not been publicly identified.

The case remains a cautionary tale about the current state of prediction market regulation—and an opportunity for savvy traders who can identify and follow insider activity before it's too late.

Key Takeaways

• AlphaRaccoon made $1.19M with 22/23 winning bets on Google Year in Search markets
• A Meta engineer alleges Google accidentally leaked results early
• Polymarket's CEO says insider trading is "not prohibited" and even "cool"
• Corporate announcement markets are high-risk for retail traders
• Whale tracking tools can help identify potential insider activity
• The scandal may prompt regulatory action as Polymarket enters the US market