Spotify to Kalshi and Polymarket: Remove Our Logo — Traders Pumped Streams to Win a $3M Bet
Spotify identified over 500,000 artificial streams injected into Malcolm Todd's song 'Earrings' to manipulate its US chart position — then sent formal letters on July 2 demanding that Kalshi and Polymarket remove its branding and clarify there is no partnership. The manipulation targeted a $3M Kalshi market on the most-streamed song in the US for June. Kalshi had already paid out bettors before the fraud was confirmed.
Spotify identified and removed more than 500,000 artificial streams injected into Malcolm Todd's song 'Earrings,' which had briefly appeared as one of the most-played tracks on its US charts in June. The inflation was not for chart glory or playlist placement — the target was a $3 million Kalshi prediction market on which song would be most streamed in the US that month. Traders who held contracts on 'Earrings' could profit directly from flooding the song with bots, which is exactly what the evidence suggests happened. Kalshi paid out the market based on the inflated figures before Spotify confirmed the manipulation, meaning the settlement has already occurred on fraudulent data.
On July 2, Spotify sent formal letters to both Kalshi and Polymarket asking each platform to remove its logo and branding from any active or historical markets, and to make clear to users that Spotify has no commercial relationship with either exchange. The demand is not a lawsuit — Spotify has not announced legal action — but it signals that the streaming platform considers the use of its charts as settlement data without authorization to be a problem it wants on record. Kalshi has said it is investigating. Neither platform had disclosed a data or licensing agreement with Spotify before this incident.
The underlying mechanics are a textbook oracle-manipulation problem that prediction market theorists have written about for years, now visible at consumer scale. When the event that settles a market can be influenced by someone who holds a financial position in that market, you have created an incentive for manipulation that scales with the market's size. A $3 million market on a Spotify chart position is small by the standards of this summer's World Cup volume, but the economics work: if artificial streams cost a fraction of the contract value, and the payout on winning the manipulation exceeds the cost, rational bad actors will attempt it. Kalshi's sports and entertainment markets — which now make up the majority of its US trading volume — use third-party data sources as oracles, and the integrity of those sources is now a first-order platform risk.
This incident lands at a sensitive moment for the industry. The CFTC's proposed rule, open for public comment until July 27, is built around the idea that prediction markets settle on 'objective data with integrity infrastructure.' Opponents of the rule — state attorneys general, gambling regulators, the tribal gaming coalition — have argued that prediction markets are closer to gambling than to financial instruments, and that their settlement mechanisms are manipulable in ways traditional regulated sports betting is not. The Spotify episode will be cited in those comment letters. It is also the kind of incident that the senators who have asked the CFTC to investigate Polymarket's marketing practices will reference to broaden the conversation. The platforms need a clean answer to how their oracle integrity works before those arguments gain more traction.
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Recent updates
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