A Polymarket user made roughly half a million dollars in one day after betting on the timing of the U.S. strikes on Iran.
The user, “Magamyman,” was called out by Democratic Rep. Mike Levin in a post on X, where he pointed out that the first trade was placed only 71 minutes before the news broke publicly. At the time, the platform only had it at a 17% probability.
Another user, “Dicedicedice,” made almost $150,000 on the bet, also made mere hours before the strikes, according to the Financial Times. Software company Bubblemaps said in an X post on Saturday that it had identified six crypto wallets on Polymarket that made a total of $1.2 million by betting that the U.S. would strike Iran before February 28. All of the wallets were funded within the last day and had made the bets just hours before the strikes.
“Prediction markets cannot be a vehicle for profiting off advance knowledge of military action,” Levin wrote in the post. “We need answers, transparency, and oversight.”
Insider betting is a common and actually revered practice on betting platforms like Polymarket and its competitor, Kalshi. The common argument posed by prediction market fans is that insider trading is pretty much the entire point, as any insider action could be used as a signal of news before it actually drops.
Opponents to that argument say that using non-public information to make money on bets can be unfair or potentially fraudulent, and allowing it only stands to make rich and powerful insiders richer and more powerful. Not to mention that betting on war, like the one currently unfolding in the Middle East that has already claimed the lives of more than 200 people, is a pretty pure example of profiting off of human suffering.
Polymarket started getting significantly more heat for the practice when a brand new account made more than $436,000 in January, betting on the Venezuelan President Nicolás Maduro’s downfall, just hours before his capture by U.S. forces was made public knowledge.
In a statement on the platform, Polymarket defended its decision to continue to allow betting on the war in the Middle East, arguing that prediction markets “create accurate, unbiased forecasts” that are “invaluable in gut-wrenching times like today.”
“After discussing with those directly affected by the attacks, who had dozens of questions, we realized that prediction markets could give them the answers they needed in ways TV news and X could not,” Polymarket claims.
Prediction markets have been in muddy regulatory waters. Once a banned platform in the U.S., Polymarket made its grand return after newly elected President Trump dropped DOJ and Commodity Futures Trading Commission investigations into the company and cleared a path to legality for betting markets. Trump’s son, Donald Trump Jr., also sits on Polymarket’s advisory board.
But while these platforms are gaining credibility in the United States, some politicians are still working to at least limit operations. At the state level, regulators in states like Nevada and New York are trying to limit political and sports betting on the platforms.
At the federal level, the House has yet to vote on a bill that would ban federal officials from betting on policy outcomes. Earlier this week, six Democratic senators sent a letter to the CFTC asking it to “categorically prohibit” prediction markets from offering contracts “that incentivize physical injury or death” by resolving the bet based on an individual’s death. Some bets on the platform regarding Iran’s former supreme leader Ayatollah Khamenei‘s removal by U.S. forces have since been resolved to “no” following his death.
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