Dem lawmakers blasted prediction markets after suspected insiders made more than $1 million from contracts tied to the US-Israeli air strikes on Iran over the weekend – including an alleged $550,000 windfall related to the killing of Iranian Supreme Leader Ayatollah Ali Khamenei.
Six freshly-created accounts on Polymarket raked in $1.2 million by betting that the US would strike Iran on Feb. 28, according to analytics firm Bubblemaps SA – with some shares purchased just hours before the first explosions were reported in Tehran.
It was part of a surge of activity on Polymarket – a largely unregulated prediction market – as $529 million was traded solely on contracts tied to the strikes, according to Bloomberg.
Responding to a tweet about the alleged insider trading, Sen. Chris Murphy (D-Conn.) wrote Saturday: “It’s insane this is legal. People around Trump are profiting off war and death. I’m introducing legislation ASAP to ban this.”
Another Polymarket account called “Magamyman” raised suspicion after it made $553,000 in a single day by placing bets that Iranian Supreme Leader Ayatollah Ali Khamenei – who was killed in the attacks Saturday – would soon be out of power, NPR reported.
“When this person bought in, the market had this at a 17% probability. They turned roughly $87,000 into over half a million dollars overnight,” Rep. Mike Levin (D-Calif.) wrote Saturday.
“Prediction markets cannot be a vehicle for profiting off advance knowledge of military action. We need answers, transparency, and oversight.”
Levin noted that Donald Trump Jr. sits on Polymarket’s advisory board and that the DOJ and CFTC scrapped active investigations into the prediction market soon after President Trump returned to the Oval Office.
Earlier this year, similar trading patterns raised alarms after a Polymarket user made $400,000 betting on the ouster of Venezuelan dictator Nicolás Maduro in January.
Polymarket has already added several new contracts related to heightened tensions in the Middle East, with a top trending bet on its site on whether the Iranian regime will fall by this summer.
The site included more contracts tied to further military action, including whether the US and Israel will launch additional strikes on Iran this week and when US forces might enter Iran.
The winning Polymarket contract tied to a strike on Iran by Feb. 28 recorded around $90 million in trading volume – making it the most popular contract date by far for a strike on the nation, according to Bloomberg.
The next most-traded contract was for an attack by Jan. 31, which saw $42 million in trading activity.
Polymarket did not immediately respond to The Post’s request for comment.
Many US states that have passed laws regulating sports gambling platforms in recent years are now arguing that prediction markets should abide by these same regulations.
Trump’s former acting Chief of Staff Mick Mulvaney recently launched Gambling Is Not Investing, a new group looking to crack down on prediction markets, specifically those with sports contracts.
Polymarket’s main trading platform is located offshore and the company does not allow American bettors to use the site, so it is able to escape CFTC regulations. But there are tons of guides online that detail how US users can skirt around these blockages using a VPN, raising questions around how this rule is enforced.
Rival Kalshi – an American prediction market – said it “doesn’t allow markets directly tied to death” on its platform.
The company recently banned and fined two users it accused of insider trading, including a MrBeast employee who allegedly traded on contracts related to the YouTuber’s content and a former GOP gubernatorial candidate who bet on himself to win in a California race.
Kalshi did not immediately respond to The Post’s request for comment.
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