Spotify demanded that the prediction market platforms Kalshi and Polymarket immediately remove its logo from their services after identifying that manipulated streaming data influenced the outcome of a betting contract. The company also reinforced that it has no commercial partnership with either of the two platforms.
The decision was made after the streaming service concluded that the song "Earrings", by artist Malcolm Todd, received more than 500 thousand artificial plays. The irregular increase caused the track to temporarily appear as the most streamed song in the United States, information that was used as the basis to settle a prediction contract available on Kalshi.
The market had been launched in June and allowed users to bet on which song would be the most listened to on Spotify in the US. Before the conclusion of the streaming platform’s investigation and the removal of the fake plays, Malcolm Todd ended up being declared the winner of the contract.
The episode moved approximately US$ 3 milhões in trades, raising doubts about the reliability of prediction markets that rely on public indicators and third-party data to determine their results.
After confirming that there was manipulation of plays, Spotify contacted both Kalshi and Polymarket. In addition to requesting the removal of its visual identity, the company asked that both make it clear to users that there is no kind of commercial agreement or official partnership involving the streaming platform.
According to a Kalshi spokesperson, the company is cooperating with Spotify during the investigation of the case and is conducting its own investigation to understand how the altered data influenced the market settlement.
The incident broadens the debate about the challenges faced by prediction markets when their contracts depend on information produced by external platforms. If this data is manipulated before a definitive verification, the financial results of these markets may be affected.
Meanwhile, Spotify stated that it maintains permanent systems to identify fraudulent activity, remove artificial plays, and preserve the integrity of its music rankings, reducing the impact of manipulation attempts on artists, users, and companies that use these indicators as a reference.