Polymarket CEO calls 100x token chasing "hot potato"

Polymarket CEO Shayne Coplan has said that traders who are hunting the next 100x token are playing a game of “irrational exuberance and hot potato.” 

He said this on Wednesday, October 7, at the ongoing TOKEN2049 Singapore event, and his warning is aimed at the retail speculators that his prediction market is trying to win over with steadier odds.

Why Coplan is calling leverage trading hot potato

Coplan described the hunt for early, explosive token gains as a bet that something worthless can be offloaded before it collapses. Coplan said, “People think they’re buying something, it’s worthless, but they’re buying it. If it can go to 100X, they want to sell it before it goes back to zero.”

While he acknowledged that a few traders do get rich this way, he framed the strategy as one where prices that climb are bound to fall.

The CEO reached for an old reference point. His “irrational exuberance” phrasing echoes the 2000 book of the same name by Nobel laureate economist Robert J. Shiller, which studied how market optimism feeds on psychology and social dynamics. Coplan’s argument is that crypto’s lure of fast money collides with the fact that picking the winning altcoin is rare.

In December, BitMEX co-founder Arthur Hayes made a related point, stating then that the altcoin season never actually ended; however, most traders missed the cycle’s biggest gainers.

The pitch for prediction markets over moonshots

Coplan’s comments double as a sales pitch for his own platform. According to him, the draw of prediction markets is the absence of a lottery ticket. He said, “On Polymarket, if you’re trading these markets, there’s no exponential upside.” Coplan added that informed traders keep placing bets because the odds on future events are more predictable than a memecoin’s chart.

Polymarket is the second-largest prediction market platform, trailing Kalshi. The platform recorded a DEX volume of over $1.22 billion over the past seven days, per DefiLlama data. Kalshi logged $2.3 billion over the same period.

A December report from 10x Research stated that prediction markets are becoming crypto’s new battleground. The research showed that these markets enable data-driven “elite” traders to feed on the information asymmetry left by casual bettors chasing a quick win.

The manipulation and regulation clouds overhead

Researchers at Stanford University and Singapore Management University discovered that Polymarket’s five-minute Bitcoin contracts created incentives to manipulate spot prices right before settlement.

Pressure to further regulate the space is also building. While the CFTC has oversight in terms of regulation on the federal level, prediction market platforms have ran into hot waters on the state level.

In September, New York Attorney General Letitia James sued Polymarket US, alleging it runs an unlicensed gambling operation. The attorney general asked a state court to shut it down.

The latest suit joins the federal-versus-state jurisdiction fight that the CFTC opened against New York and a few other states, including Arizona, Connecticut, and Illinois.

In July, the attorneys general in 44 states wrote a letter to the CFTC challenging its authority to regulate sports-related event contracts.

Some of the states have already taken action against Polymarket, Kalshi, or both over sports contracts.

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