Polymarket bets on US-Iran ceasefire appear to suggest insider trading
The accounts, which stand to make nearly $820,000, seem to have been created late last week when Trump suggested he was considering 'winding down' military operations
Bets made on the likelihood of a US ceasefire with Iran on the Polymarket betting site over the weekend were likely made using insider knowledge, The Guardian newspaper reported on Tuesday.
According to the report, a total of eight new accounts created around March 21 bet almost $70,000 on there being a ceasefire before March 31. They stand to win nearly $820,000.
The accounts seem to have been created last week when US President Donald Trump posted on Truth Social that he was considering “winding down” strikes against Iran.
On Monday, in a bombshell announcement, Trump revealed that his administration was engaged in what he said were productive talks with Iran regarding a “complete and total resolution” of the US-Israeli war with the Islamic Republic.
The wallets “definitely [look like] someone with some degree of inside info,” Ben Yorke, formerly a researcher with CoinTelegraph, now building an AI trading platform called Starchild, told The Guradian.
“Typically, when you see wallet-splitting and deliberate attempts to obfuscate identity, it’s one of two scenarios: either a very large investor trying to shield their position from market impact, or insider trading,” said Yorke.
Tracing and identifying the owners of the crypto wallets that laid the bets are challenging because Polymarket accounts are anonymous.
Another account that placed the same bet on the ceasefire also placed winning bets on the US and Israel striking Iran on February 28. That account was created just before the start of the war and has not made any other bets, which raised suspicions regarding insider trading.
On Polymarket Discord channels Monday, users and bots shared strategies on making money from the war in Iran. One post recommended a “yes” bet on a March 31 US-Iran ceasefire, noting three profitable traders backed it while an unprofitable one bet “no.”
Polymarket’s odds of a ceasefire before March 31 jumped from 6% on March 21 to 24% by Monday, with over $21 million now wagered on the outcome.
Settling the bet requires that: “For the purposes of this market, an ‘official ceasefire agreement’ requires clear public confirmation from both the United States government and the government of Iran that they have agreed to halt military hostilities against one another,” The Guardian reported.
Online prediction markets such as Polymarket and Kalshi, the two biggest prediction market platforms, are rapidly becoming a feature of modern warfare.
Both Kalshi and Polymarket rushed to institute new industry guardrails and add new surveillance tools on Monday after two key US senators announced legislation that could severely curtail the industry’s prospects.
Polymarket instituted its own set of bans and rules. The company rewrote its rules to say clearly that users cannot trade on contracts where they might possess confidential information or could influence the outcome of an event. This would include athletes but could also include company officials, policymakers or anyone who would have enough influence to affect the outcome of an event or know the information in advance.
“These rule enhancements make our expectations abundantly clear for every participant across both platforms,” said Neal Kumar, Polymarket’s chief legal officer, in a statement.
Polymarket, in particular, has faced intense criticism after some of its users made substantial bets ahead of the war in Iran and the US military action in Venezuela earlier this year. Those users appeared to have profited handsomely from knowing in advance that Trump was going to take military action in those regions.
In an incident earlier this month, The Times of Israel’s military correspondent faced death threats and harassment from Polymarket gamblers who had bet on an Iran missile attack on Israel and were trying to get him to change his reporting so they could win a bet.
Kalshi and Polymarket have found backing from the Trump-controlled Commodity Futures Trading Commission, the federal regulator of derivatives and other prediction markets activities. The CFTC’s chairman, Michael Selig, has said he would back Kalshi in any of its legal battles at the state level, arguing that federal law preempts any state law on this issue.
Any friendly decision the CFTC makes on this industry could end up financially benefiting the US president’s family as well. Trump’s son, Donald Trump Jr., has invested in Polymarket through his venture capital firm and is a strategic adviser for Kalshi.