Who is Polymarket CEO Shayne Coplan? The 26-year-old’s crypto betting site is taking U.S. politics by storm

Every election cycle seems to usher in a new forecasting star. In 2008, it was CNN’s John King and his “Magic Wall” of color-coded election data. In subsequent cycles, the “two Nates” (Silver and Cohn) rose to prominence in the statistical journalism genre, making tricks like the New York Times’ forecasting needle a fixture in political reporting. In 2024, all eyes are on a new election-year darling: the website Polymarket.

The blockchain-based betting site has become a go-to for political insiders after several instances where it predicted major election developments long before the media. For example, in the past few months, Polymarket predicted President Joe Biden’s withdrawal of his re-election bid and Donald Trump’s selection of JD Vance as his running mate. The site’s reputation has grown so much that even Nate Silver agreed to join the company as an advisor.

Little known outside a small circle of crypto types, Polymarket’s creator is 26-year-old New York City native Shayne Coplan. His appearance suggests he should be on tour with an alternative rock band rather than running one of the most influential sites in contemporary politics. Coplan has so far avoided the spotlight, but that’s likely to change in the near future as Polymarket, which has raised $70 million, grows its profile in U.S. political life.

A crypto guardian comes of age

At his recent dinner party in Manhattan, Coplan showed up in jeans and a leather jacket. He had come at the request of a venture capital firm to gather the startups in his portfolio and meet with members of the media. Coplan was easily recognizable by the unruly curls that framed his head and the relaxed demeanor that set him apart from the other founders.

While venture capitalists like to say they don’t have a favorite child among their portfolio companies, the promoter secretly identified “the Polymarket guy” as the most worthwhile person to meet. But Coplan appeared in no rush to make the rounds, and after some polite chit-chat, he excused himself from the table during the main course and said he had to go to a concert in Brooklyn.

New York is a place Coplan knows well. He was raised by his mother on the Upper West Side and went to public school in Hell’s Kitchen, near the theater district. He learned to code as a teenager and, according to his crypto knowledge, was the youngest participant in Ethereum’s first sale in 2014, when the token, which trades for about $3,500 today, could be purchased for 30 cents. Coplan went on to earn a bachelor’s degree in computer science from New York University, but then dropped out before graduating to pursue a growing obsession: crypto and prediction markets.

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“He wants to be able to talk about this forever. This is his life. He lives it,” says Rob Hadick, a partner at venture capital firm Dragonfly, one of Polymarket’s investors. He added that in the first meeting, Coplan avoided a formal presentation in a conference room and instead suggested a walk, which turned into a two-hour walk around New York during which Coplan talked prediction markets into Hadick’s ear.

As books like The Wisdom of Crowds explain, using collective guesses to determine the likelihood of future events is often more reliable than consulting experts. The concept is hardly new, and in fact variations of it, including market-based prediction markets, have been around for centuries. And while there are other online betting platforms, like Ireland’s Paddy Power, that allow users to bet on everything from sports to politics, Coplan says Polymarket is different.

“This is much more categorized as a derivatives platform, and the pricing of these types of derivatives becomes invaluable real-time information,” Coplan said via text message, pointing out that odds are determined on an ongoing basis by a pool of bettors, rather than a central oddsmaker. (Polymarket is also notable for settling and paying out bets using smart contracts; specifically, through a sublayer of the Ethereum blockchain known as Polygon.)

In recent months, Coplan has had the opportunity to speak directly to politicians about the benefits of his site, including at a breakfast with Florida Gov. Ron DeSantis. Last week, he also shared a retweet of images from the site displayed around RNC headquarters, but has so far been careful not to reveal his own political leanings.

When asked for a formal interview, something he hasn’t done since Polymarket first came to the fore in 2020, Coplan politely declines, citing his busy schedule.

Coplan’s online footprint is shallow. There are a few photos showing a 20-year-old Coplan, sans curly hair, addressing a crypto meeting at the Bitcoin Miami conference in 2018 and taking a boat ride. But he has otherwise avoided media attention — though, as Polymarket has become a household name, he may not have that luxury much longer.

Betting on an uncertain future

Most people are familiar with online betting sites, including those in the US for sports betting or overseas sites that allow bettors to wager on everything from elections to the possibility of alien landings. Polymarket offers all of these bets as well, but it works very differently behind the scenes.

Instead of a central bookmaker, the probability of a particular event is determined by Polymarket users who can buy “stakes” in a particular outcome. For example, those who think Donald Trump will replace his running mate JD Vance on July 31 can pay 8 cents and if that happens, the value of their contract will rise to $1 (if it doesn’t happen by election time, it will fall to zero). And of course, the price will fluctuate in response to news events.

Polymarket has declined to pursue the most obvious source of potential revenue for now: taking a cut of betting on the site. Instead, its evolving business model, which also includes an upcoming feature that will allow users to pay with credit cards rather than just cryptocurrency, appears to involve a media and possibly a consulting operation. Semafor reported this week that Polymarket is in the process of publishing a series of newsletters and is also partnering with major media outlets that will include its data in their coverage (charts from the site have already appeared in the Wall Street Journal ). The company did not disclose how much revenue it will generate from these initiatives.

There’s also the potential for Polymarket to charge fees for certain bets that appear on its site. Right now, the company is making suggestions on its Discord platform, which then lets its community know which ones will be added. Recent additions include bets on Simone Biles’ medal collection and the possibility of a US-Iran military conflict through August 31. But for now, there’s no indication that Polymarket plans to allow companies to pay to list a bet.

Are Polymarket shares the most popular bet?

Polymarket isn’t the first of its kind. Previous crypto projects like Augur and Gnosis have offered a decentralized betting platform, but they never gained traction. Polymarket, by contrast, has become part of political Twitter and is the go-to site for 85% of all online betting on the outcome of the US presidential election, according to Nick Tomaino (whose venture fund 1Confirmation has invested in all of these projects).

The site’s rapid growth (it attracted a record 42,000 bettors on July 1, up from 4,000 in January) is perhaps surprising given that bettors in the US, where it is illegal to bet on elections, are prohibited from using the platform, and Polymarket requires users to connect a crypto wallet and make payments using the USDC stablecoin. These hurdles also raise the question of whether Polymarket’s mostly non-American bettors, steeped in crypto culture, can make reliable predictions about US election events.

Tomaino acknowledges that if Americans had participated, he would have ended up with a better sample, but he says Polymarket still provides a very strong signal. That’s because, like other prediction markets, it doesn’t simply reflect the “wisdom of crowds,” but relies on a group of people who have a financial stake in an outcome and are likely to be more knowledgeable.

When considering Polymarket and all betting markets, it is also useful to remember that the possible outcomes they show are only probabilities. In 2016, most pollsters and betting sites said Hillary Clinton had a 75% to 85% chance of victory. The fact that she lost does not invalidate these predictions, but rather reflects the lower but very real probability that Donald Trump would win, and that this is the probability that has come true.

Polymarket is more than just a new attraction on the US election scene. It’s also a popular startup, having raised $70 million to date, including a $45 million funding round in May, from influential investors — not just crypto royalty like Ethereum creator Vitalik Buterin and early Coinbase employees, but also notable venture capitalists like Peter Thiel.

Still, it remains unclear exactly how Polymarket plans to make money. The site’s revenue is currently “very low,” according to Tomaino, despite covering overhead costs such as a New York City office and a staff of 25 to 30 people.

And Polymarket’s biggest challenge may be convincing regulators to let it operate in the U.S. In 2010, the Commodity Futures Trading Commission banned derivatives, or so-called event contracts, that involved terrorism and other illegal activities, including “gambling,” under the financial reform law known as Dodd-Frank. The CFTC, which fined Polymarket $1.2 million in 2021 for operating in the U.S., did not define gambling at the time, but is currently drafting new regulations to explicitly ban election betting.

Investor Tomaino is unimpressed. He sees concerns that election betting could corrupt the political process as misguided, noting that such betting has provided insights for more than a century, and that super PACs, which allow anonymous donors to spend millions of dollars on behalf of candidates, appear to pose a greater threat to election integrity. As for Coplan, he says he’ll likely become more visible in the coming months. But for now, he’s “just focused on the product.”

This story was first published on Fortune.com