BackPack released a statement on March 25 disclosing an attempted cross-market manipulation. A trader had placed a large bet on Polymarket's "BP FDV > $200 million" prediction market, which required BP's price to exceed $0.20. At the time, BP was trading at $0.19. The trader then bought heavily on the spot market to push the price above the threshold.
No Insider Involvement Found
BackPack's internal investigation confirmed the trader was not an employee, director, executive, or advisor, and had no affiliation with the project. The company stated: "We have zero tolerance for any form of insider trading or market manipulation." Polymarket also updated its platform rules on the same day, explicitly prohibiting three types of manipulative behaviors.
BP Token Plunges Over 25% Post-TGE
BP launched on March 23 with an opening price of $0.31, reaching a fully diluted valuation of $3.1 billion and an intraday high of $0.3771. It has since fallen more than 25%. The Polymarket prediction odds for "BP FDV > $200 million" had peaked at 87% before the incident.
BackPack emphasized that the TGE used a 0% insider allocation, but its anti-Sybil mechanism remains controversial, with many Chinese-speaking users reporting false positives. The project has launched an appeal and buyback compensation process. The incident highlights risks in the interaction between prediction markets and spot markets, prompting stricter rules from both platforms and regulators.