Polymarket Bank-Failure Contracts Draw FDIC Officials’ Concern
Contracts involving JPMorgan Chase, Bank of America and Wells Fargo recorded about $76,000 in year-end trading volume on Polymarket’s overseas platform.
Contracts betting on a bank failure by the end of this year involving JPMorgan Chase, Bank of America and Wells Fargo recorded about $76,000 in total trading volume, drawing concern from Federal Deposit Insurance Corporation (FDIC) officials.
Some officials worry that larger volumes could encourage real-world bank runs. FDIC discussions also examined whether employees could use nonpublic information to trade the contracts, but concluded existing ethics rules already prohibit that activity.
The contracts are available only on Polymarket’s overseas platform. Polymarket’s U.S. regulated platform does not offer the products.
Polymarket describes the markets as giving the public access to information typically available only to professional financial institutions.
