Spotify Orders Kalshi and Polymarket to Remove Its Branding After Manipulated Streams Distort Prediction Market

Spotify has demanded that Kalshi and Polymarket remove its branding and clarify that neither prediction market platform has an official partnership with the music streaming giant after manipulated streaming activity influenced the outcome of a $3 million prediction market. The controversy erupted after more than 500,000 artificial streamstemporarily pushed Malcolm Todd’s song “Earrings” to the top of Spotify’s U.S. charts, data that was subsequently used to settle a Kalshi prediction market before the fraudulent activity was discovered. The incident has intensified concerns over how easily external data sources can be manipulated when they serve as the basis for blockchain-based prediction markets.

After investigating the unusual spike in streams, Spotify removed the fraudulent plays and corrected its charts, causing the song to fall from No. 1 to No. 4. By that point, however, Kalshi had already settled the market using the original chart rankings, allowing winning traders to collect payouts based on manipulated data. Spotify has since requested that both Kalshi and Polymarket remove its logo and clearly state that neither platform is affiliated with the company.

More Than 500,000 Fake Streams Triggered the Dispute

The controversy centered around Malcolm Todd’s single “Earrings,” which unexpectedly surged to the top of Spotify’s daily U.S. streaming chart.

According to Spotify’s investigation, more than 500,000 artificial streams were generated through fraudulent activity that did not reflect genuine listener behavior. Once those fake plays were removed, the song dropped back to fourth place, confirming that the original chart position had been artificially inflated.

Spotify emphasized that it routinely monitors for manipulated streaming activity and does not pay royalties associated with fraudulent plays.

Prediction Markets Used the Manipulated Rankings

The manipulated chart had immediate financial consequences.

Kalshi was operating a prediction market asking traders to forecast which song would finish as the most-streamed song in the United States during June. The contract attracted approximately $3 million in trading volume before settlement.

Because Kalshi settled the market before Spotify corrected its data, payouts were distributed based on rankings that were later determined to be inaccurate.

There is currently no evidence that Malcolm Todd or his management team participated in or benefited from the streaming manipulation, according to reports.

Spotify Distances Itself From Kalshi and Polymarket

Following the discovery, Spotify moved quickly to separate itself from both prediction market platforms.

The company requested that Kalshi and Polymarket:

• Remove Spotify’s logo.
• Clarify that no partnership exists.
• Eliminate any branding that could imply official cooperation.

Spotify’s concern appears to center on preventing users from believing the prediction markets receive official data feeds or endorsements from the streaming platform.

Kalshi confirmed it is communicating with Spotify while conducting its own investigation into how the manipulated data affected market settlement. Polymarket stated that the specific song involved was not even available as a prediction option on its platform, though Spotify requested branding changes from both companies.

Prediction Markets Face New Manipulation Risks

The incident exposes a growing challenge for prediction markets.

Unlike traditional financial markets, many prediction contracts rely on external data sources—including music charts, sports statistics, election results, and social metrics—to determine winners. If those underlying data sources can be manipulated, prediction markets themselves may become vulnerable even when their blockchain infrastructure remains secure.

Industry observers note that prediction markets are only as trustworthy as the data used to resolve their contracts.

Kalshi and the Industry Face Growing Scrutiny

The controversy arrives during a period of rapid expansion for prediction markets.

Platforms such as Kalshi and Polymarket have attracted billions of dollars in trading volume across markets covering politics, sports, entertainment, economics, and cryptocurrency. As these platforms continue growing, regulators and market participants are increasingly examining how contracts are settled and whether outcomes can be manipulated by actors with financial incentives.

Researchers have recently warned that certain prediction market structures may be susceptible to settlement manipulation if participants can influence the underlying event or reference data.

Spotify Tightens Chart Verification

Following the incident, Spotify is reportedly implementing additional safeguards before publishing future chart rankings.

The company already employs automated systems to detect artificial streaming activity, but reports indicate it will now perform additional verification checks before official chart data becomes available for public use. The goal is to reduce the likelihood that manipulated streaming campaigns influence chart rankings or downstream financial products tied to Spotify data.