Insider Trading Through Crypto Bets
A Google security engineer has been charged with insider trading after allegedly using confidential company data to place winning bets on the decentralized prediction platform Polymarket. Michele Spagnuolo, a 36-year-old Italian citizen and Google employee since 2014, appeared in a New York court on Wednesday. The Commodity Futures Trading Commission (CFTC) also filed a civil complaint against him on the same day.
According to the criminal complaint, Spagnuolo accessed an internal Google tool containing sensitive data about the company’s annual “Year in Search” rankings. This information was clearly marked as confidential. He then used this data to place bets on his Polymarket account, operating under the alias “AlphaRaccoon.” The bets targeted whether specific individuals would appear in Google’s top trending search lists, and Spagnuolo achieved near-perfect accuracy across about 25 unlikely outcomes.
The Scheme and Its Aftermath
Over several weeks beginning in October 2025, Spagnuolo risked roughly $2.75 million in total. When Google publicly released its Year in Search results on December 4, 2025, his Polymarket account collected approximately $1.2 million in winnings. After online communities on platforms like Discord and X began to suspect that AlphaRaccoon was a Google insider, the username was removed from the account, which reverted to an alphanumeric wallet address.
The FBI traced the AlphaRaccoon account back to a payment processor account registered in Spagnuolo’s name and linked to an Italian government identification card. Prosecutors also alleged that Spagnuolo moved the illegal proceeds through several cryptocurrency swapping services, including one that strips wallet addresses from the blockchain. He now faces up to 10 years in prison on a commodities fraud charge and up to 20 years each for wire fraud and money laundering.
Source: BleepingComputer
