Spotify removes fake streams after betting scandal

Spotify removed 500,000 fake streams from Malcolm Todd’s “Earrings” after manipulation linked to $3M in prediction market bets, raising concerns about market-driven chart manipulation.

Spotify removed over 500,000 fake streams from Malcolm Todd’s song “Earrings” after it unexpectedly topped the U.S. charts. The surge was traced to manipulation linked to prediction markets, especially Kalshi, where traders bet $3 million on which song would be most-streamed in June. Kalshi settled bets and declared Todd the winner before Spotify finished its investigation. Once the manipulation was uncovered, Spotify asked Kalshi and Polymarket to remove its branding and clarify there was no official partnership. Kalshi is cooperating with the investigation, while Polymarket has not responded. This incident has raised concerns about prediction markets incentivizing chart manipulation, as traders could profit by artificially boosting streams. Spotify announced it will not pay royalties for fake streams. The controversy also led to a 2.86% rise in Spotify’s stock price as the news broke.