Caleb Davies, a well-known trader on Kalshi, often shares with the media how prediction markets play a role in his financial achievements. The IT expert from Minneapolis indicates that he has made roughly $1.2 million across different prediction platforms, with $414,000 coming from Kalshi’s culture markets. Davies is particularly focused on music charts, utilizing Spotify data to inform his betting strategies. “Every morning, I download the data and update my projections,” he tells WIRED.
Nonetheless, this summer, Davies has expressed concerns regarding what he sees as automated manipulation within Spotify-related markets. He has collected and disseminated evidence supporting these concerns and has contacted Spotify, Kalshi, and Polymarket to relay his apprehensions.
The situation escalated when Malcolm Todd’s song “Earrings” unexpectedly soared to the top of a Spotify chart. In a series of posts on X, Davies speculated about the presence of “botting,” where automated systems artificially boost streaming numbers. He proposed that traders in the prediction market were employing bots to modify event contracts. Todd’s surprising ascent wasn’t even represented on Polymarket, suggesting a statistical anomaly that Davies deemed questionable.
Spotify confirmed that it examined the manipulation incidents pointed out by Davies and detected fraudulent streaming activity. “All streaming services face continuous manipulation. Spotify deploys advanced detection measures and does not compensate for manipulated streams,” stated spokesperson Laura Batey. There was no formal statement regarding Davies’ theory on prediction markets manipulation.
After the inquiry, Spotify revised its charts, eliminating over 500,000 fraudulent streams, which resulted in Todd’s drop from first to fourth place. This adjustment arrived too late for Kalshi, which had already rewarded those who bet on Todd’s track.
Kalshi spokesperson Elisabeth Diana disclosed that they have been in ongoing discussions with Spotify. Consequently, Kalshi removed Spotify’s branding from relevant markets and specified that Spotify had not authenticated the chart outcomes.
When Davies raised his concerns with Kalshi, the company’s head of enforcement, Robert DeNault, indicated that only Spotify could validate botting activity. He also proposed alternative explanations for the surge.
Davies informed WIRED, “No one from Polymarket profited from the fraud. This contradicts Kalshi’s perspective as Malcolm Todd wasn’t an option there.”
Polymarket counters this assertion. “This assertion is impractical because we did not list Malcolm Todd in this Spotify market,” conveyed spokesperson Annabel Walsh. The platform is probing the larger issue of streaming manipulation, but has not identified any immediate problems.
The motives of those responsible for the manipulation remain unclear, as no direct communications have occurred. Todd has not made any remarks, and there is no evidence of his involvement.