P2P.me has landed in hot water. The crypto startup revealed it liquidated a Polymarket position betting on its own $6 million fundraising goal — using foundation funds placed through an account named "P2P Team" — ten days before the investment round was officially publicized. The disclosure on March 28 quickly ignited an insider trading debate.
Oral commitment: Material non-public info or not?
The timing is the crux. At the time of the trade, P2P.me had already received a verbal $3 million commitment from investment firm Multicoin, but no signed documents were in hand. The company argued the outcome was still uncertain, so the trade didn't constitute insider dealing. Some legal commentators pushed back, saying verbal commitments can still qualify as material non-public information that shouldn't be used for wagering.
P2P.me explained the account name was a deliberate marketing signal to the community, reflecting intent to be transparent. It admitted the lack of disclosure at the time was "a mistake we own," and said it took time to study legal implications before responding. "Intent isn't the same as action. Not disclosing at the time was a mistake," the company stated.
Industry reactions: Bad marketing or dumb insider play?
P2P.me ultimately raised $5.2 million from external backers, closing the Polymarket position at $35,212 for a net gain of roughly $14,700 on an initial $20,500 stake. Simon Dedic, co-founder of Moonrock Capital and an investor in P2P.me, defended the move: "No one with any common sense would risk a $6 million raise over $15,000. The idea was to show conviction in the sale by betting on themselves. Otherwise, you'd have to argue they're the most incompetent insider traders of all time."
Mounting criticism ahead of its planned token generation event prompted P2P.me to pledge all profits to the MetaDAO Treasury, clarifying that MetaDAO — a decentralized autonomous organization involved in blockchain development — was unaware of the trades beforehand.
Prediction market boom and regulatory catch-up
The controversy sits against a backdrop of explosive growth in blockchain-based prediction markets. According to TRM Labs, transaction volumes on decentralized prediction platforms surged from $1.2 billion in early 2025 to over $20 billion by January 2026. The rapid expansion has pushed platforms like Polymarket and Kalshi to deploy enhanced surveillance measures targeting insider trading and compliance with financial laws.
The P2P.me case pries open an uncomfortable question for prediction markets: should project principals be allowed to bet on their own outcomes? When information asymmetry is baked in, retail users may find little protection — unless regulators step in.