Coinbase Investigates AI Prediction Market Glitch After Erroneous World Cup Alert
Coinbase CEO Brian Armstrong has confirmed the cryptocurrency exchange is investigating an artificial intelligence-generated prediction market alert that mistakenly informed users of a “breaking news” event: a supposed 3-2 victory for Norway over Brazil in the FIFA World Cup, prior to the match’s scheduled kickoff at MetLife Stadium.
The premature notification also claimed Manchester City forward Erling Haaland had scored twice to secure a quarterfinal berth for Norway.
Intriguingly, Coinbase’s own prediction market page indicated the match had been postponed due to adverse weather conditions. However, the situation became even more peculiar as Norway did, in fact, go on to defeat Brazil when the game was eventually played, albeit with a different scoreline, and Haaland did score two goals.
The discrepancy was first highlighted by Jay Drain Jr., managing partner at Relay Digital, who posted on X (formerly Twitter) that Coinbase’s AI was “hallucinating results for a World Cup game that hasn’t even been played yet.” He criticized the notification sent to millions of users as “factually incorrect” and labeled it “dangerous and irresponsible.”
Coinbase Chief Executive Brian Armstrong later responded to the post, stating the company had initiated a review of the incident. Max Branzburg, the firm’s head of consumer and business products, provided an update, announcing that the team had “fixed the incorrect story” and implemented updates to prevent similar errors in the future.
“It’s awesome to see the power of AI-enabled 24/7 insights for trading, but obviously still need to tune it to address these types of issues,” Branzburg commented. He added, “And hey, it turns out Norway did win and Haaland did score 2 goals, so maybe the AI knew something we didn’t!”
As previously reported, the FIFA World Cup has significantly boosted trading volumes on leading prediction markets. Volumes surged from approximately $65 million in early June to a peak of $5.6 billion by the end of the month, with Kalshi capturing a substantial portion of this activity.
Amidst this surge in capital, a number of traders have experienced significant losses. One Polymarket user, identified by blockchain analytics platform Lookonchain on June 6, reportedly lost $11.63 million over a 10-day betting spree on World Cup markets.
According to Polymarket records, the user, operating under the pseudonym “Coldsway,” placed bets across 15 soccer markets, with a total trading volume of $48.19 million. Of these, only four positions resulted in wins, while 11 closed with complete losses, resulting in a win rate of 26.7%.
Coldsway’s largest winning position yielded $1.12 million from a $689,318 bet on a draw between Australia and Egypt. They also profited $962,940 from a $1.48 million wager predicting Egypt would not win their July 3 fixture.
However, these profits were overshadowed by several substantial losing bets. The single largest loss amounted to $4.95 million, stemming from Morocco’s 3-0 victory over Canada on July 4. Another significant loss of $3.10 million occurred on a prediction that Canada would not defeat South Africa on June 28.
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