At this point, it’s honestly not something you can laugh off. A market designed to crack down on insider trading has, paradoxically, turned into a breeding ground for insider trading.

Last week, blockchain investigator ZachXBT accused an employee of the crypto platform Axiom of insider trading. While this in itself is important news, the real problem is what happened afterward. On Polymarket, it seems someone may already have known the answers even before this accusation was made.

When you look at on-chain analysis, the situation becomes much clearer. The 12 wallets identified by Lookonchain placed large bets right before Axiom’s public release and have generated total profits of more than $1 million. Among them, the account “predictorxyz” has accumulated about 477,000 shares at an average of $0.14, and is currently earning a profit of $411,000. That’s about a 7x return.

What’s even more interesting is how this information spread. ZachXBT conducted multiple interviews with Axiom before the announcement, and during that process it’s likely that several parties involved became aware of the contents of the report. In other words, a small group of insiders caught on early and built major positions before the information was reflected in the market.

Looking at how Polymarket works, it’s supposed to be designed to prevent exactly this kind of thing. However, in reality it’s extremely difficult to track who is placing bets, because there’s no identity verification. Axiom says it will continue its investigation, but it remains unclear whether it will be possible to hold anyone to specific responsibility.

Bitcoin is also still unstable, trading around $74,200 at one point. On a certain major exchange’s perpetuals, the funding rate has stayed negative for 46 days, showing persistent bearish positioning. Historically, such a long-term risk-off environment can sometimes be a sign before a sharp rally, but so far there are no signs of a reversal.

Ultimately, market transparency and the gaps in regulation are what create these kinds of problems. The speed at which information catches on and the information disparity among market participants are producing these distortions.