Music streaming platform Spotify removed about 500,000 streams from a song whose soaring popularity coincided with suspicious prediction market contract purchases.
“Earrings” by Malcolm Todd shot up the streaming chart by 70% from Sunday night to Monday morning, making it the most-streamed song on Spotify, the Financial Times reports.
Key Takeaways
- “Earrings” had been on the chart for several weeks after first being released in April.
- The odds of the song spiking 70% in streams were about 1-in-77-octillion.
- Spotify removed the streams after winning Kalshi traders were paid.
“Earrings” was released on April 5, 2024, as the opening track on Todd's debut mixtape, called “Sweet Boy.” The song later became extremely popular on TikTok, leading to Columbia Records re-releasing it to pop radio as a single on April 14 of this year.
The song had been near the top of the chart for several weeks leading up to last weekend’s debacle, meaning that a sudden surge would be unlikely.
Nonetheless, “Earrings” earned enough plays from consumers to jump from fourth to first place on Spotify’s daily streaming chart for the first time. The issue is that those consumers may not have been human.
“Looking at the dataset of Sunday to Monday changes, it was a 11.24 sigma event, or a roughly 1-in-77-octillion chance of happening randomly,” top Kalshi Trader Caleb Davies wrote on X of the situation Wednesday.
The song settled in third on the daily streaming chart after Spotify manually changed the final tally. However, the change in numbers occurred after the market settled on Kalshi. Kalshi has been in contact with Spotify as it tries to discern the cause of the overnight spike.
“We're in touch with Spotify and are actively investigating this matter,” Kalshi spokesperson Elisabeth Diana told WIRED.
Spotify added that it's used to dealing with attempts at manipulation and will look for a resolution to the incident.
“All streaming services face ever-changing stream manipulation,” spokesperson Laura Batey told WIRED. “Spotify has best-in-class detection and mitigation practices for manipulated streams, and we don't pay out associated royalties.”
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What caused the spike?
Public market data from the supposedly suspicious prediction market trading shows that there was a seemingly random surge in interest for “Earrings.”
According to Davies, there was about $2,000 in public interest in Todd’s song on June 22. That ballooned to about $76,000 over the course of the week.
Spotify was delayed in releasing its daily charts and didn’t remove the artificial streams until July 1, by which time Kalshi had already paid owners of “Earrings” contracts.
Using bots to inflate streams is a common but unfortunate danger in the music industry. Artists and music labels stand to gain more money the more that their songs are streamed, which has led to the development of various ways to “trick” platforms into counting artificial streams.
Spotify conducts daily streaming audits and enforces a variety of punishments for artists found guilty of botting, such as stopping royalty payments. Despite that, botting remains an ever-present danger and has now presented a real problem on prediction markets.
Prediction market scandals
Prediction markets need integrity to thrive. That’s why insider trading has been such a great concern, and why platforms such as Kalshi and Polymarket have had to take a number of steps to preserve the integrity of their markets.
Using botting scripts and methods to inflate streaming numbers would essentially allow traders to profit at a whim by choosing a low-cost song, inflating the streaming numbers, and receiving payment for winning contracts.
Although the prediction market scandals are new to the music industry, they have been present elsewhere. A U.S. soldier won more than $400,000 at Polymarket by predicting that former Venezuelan president Nicolás Maduro would be removed from power shortly before he was captured by Special Forces.
NPR also reported prediction market news in June that disgraced politician George Santos was under investigation by the DOJ for manipulating markets by saying he would attend President Donald Trump’s State of the Union Address, only to not show. Santos allegedly purchased contracts at Kalshi predicting that he would not attend.
