High win rate of bets on military operations a likely sign of insider trading
In a Nutshell
US military personnel and others with classified access are using insider information to place high-stakes bets on prediction markets like Polymarket, achieving win rates far exceeding normal probability—such as 52% on long-shot military outcomes versus 7% for sports bets. One Army Master Sergeant allegedly made over $400,000 from a Venezuelan raid, while a cluster of nine linked accounts profited $2.4 million with a 98% success rate on Iran-related events. This pattern of suspiciously timed trades on oil futures and war outcomes signals systemic insider trading that poses national security risks, as adversaries could exploit the same data to anticipate US operations.
These notes were generated by AI and may contain inaccuracies.
The war with Iran and the US military operation to capture Venezuelan President Nicolas Maduro featured soldiers, strategy, casualties, and costs, but also included a new element of betting on war outcomes. This year alone, more than a billion dollars has been staked online on military decisions and outcomes. Bettors worldwide have taken positions on when and how attacks might happen and even the fate of world leaders, with some bets appearing suspiciously timed and based on information too specific for civilian outsiders. This has created a new category of insider trading. As long as there have been wars, there have been war profiteers, but never quite like this.
Cloaked in night and shrouded in secrecy, US special operations forces captured Venezuelan President Nicolas Maduro on January 3rd. He was taken to the US to face drug trafficking and narco-terrorism charges. The President of Venezuela was not the only figure in the operation who faced federal charges. US Army soldier Gannon Kem Van Dyke, who was involved in the planning and execution of the Venezuela mission, was charged last month with using classified intelligence to place bets based on when the surprise raid would unfold.
If the allegations are true, this represents one of the worst betrayals of trust in this area. Americans should feel confident the most important little agency they've probably never heard of is on the job. Rob Schwartz, now a private lawyer in Washington, previously worked for the Commodity Futures Trading Commission until last year, where he helped police fraud and insider trading. A soldier using classified intelligence to trade is unprecedented. The classified intelligence Van Dyke knew about came from his role in planning and executing the mission, with nothing comparable to compare it to.
The Justice Department alleges Van Dyke made a series of wagers totaling roughly $34,000, including a half dozen placed the day before the raid. He ended up netting more than $400,000. According to the indictment, Van Dyke immediately withdrew his profit then attempted to delete his betting account on Polymarket, the world's biggest online prediction market. The 38-year-old Army Master Sergeant has pleaded not guilty. Polymarket has stated it cooperated with law enforcement.
If a corporate executive with access to non-public business information trades on that information, that constitutes insider trading. The same principle applies in prediction markets where a soldier allegedly traded using classified information. This represents a new kind of insider trading, distinct from typical scenarios involving golf course conversations or winking and whispering between individuals.
Prediction markets including Polymarket offer wagers on the likelihood of future events such as whether the Dodgers will win the World Series or whether Jesus will return in 2026. A 60 Minutes interview with President Trump asking whether he would say the word trillion more than 10 times did not pay off. Recently, another kind of wager has gained popularity involving what will happen in military conflicts, including dates of attacks, whether airspace will close, and whether enriched uranium will change hands.
In the US, making military bets on platforms like Polymarket is prohibited, though digital workarounds exist as Gannon Kem Van Dyke allegedly used. More astounding than the existence of military bets is how often they pay off, creating an alarming culture around betting on war.
Michelle Kendler Kratch and her team at the Anti-Corruption Data Collective examined Polymarket bets on military outcomes, specifically focusing on long-shot wagers with less than 35% odds. Despite being underdogs, these bets won more than they lost, which she describes as a telltale sign of systemic insider trading. Military bets show a 52% success rate compared to 7% for sports wagering, a wildly disproportionate outcome compared to what conventional probability would indicate.
An ocean away, another team of digital detectives identified crooked bettors wagering on war. Nicolas Vaiman heads Bubble Maps, a Paris-based data analytics firm that creates visualizations of bets on Polymarket to spot bubbles or clusters of suspect traders. One paradox of Polymarket is that everything about the trades is totally transparent and public, except the traders themselves remain anonymous.
The firm's head of investigations, who goes by the online handle Deeds and asked to have his identity obscured due to fears of retaliation, shared what they believe is a more egregious insider trading case than Gannon Kem Van Dyke's case. They identified nine Polymarket accounts that were all connected and collectively made $2.4 million betting almost exclusively on US military operations. While Van Dyke made $400,000, this group made $2.4 million with a 98% win rate.
The linked accounts made dozens of winning bets on the specific dates of pivotal moments in the war with Iran, even when the odds were low. These included the first US strikes, the removal of Iran's supreme leader, and the announcement of a ceasefire. Luck alone cannot explain those numbers.
A source in the Defense Department stated there are dozens more cases like Van Dyke's, describing him as just a small fish. There are so many people involved in the planning and execution of a military operation.
A former US military officer named Deeb speaks from firsthand experience when stating that military bets are ripe for corruption. Beyond government officials, military planners, military intelligence analysts, and even spouses who hear things represent potential insiders, creating many opportunities for corruption.
Suspicious trading activity is not limited to high-tech online prediction markets. It is also happening on old school and heavily regulated commodities markets. David Covel, a former commodities trader now working as a New York lawyer representing victims of fraud on the same markets he once traded, secured the largest whistleblower award for commodities market manipulation in US history in 2021.
Covel walked through the morning of March 23rd when fighting had been raging for three-plus weeks and it was a slow trading day in oil futures. At 6:50 a.m., according to data from the financial firm LSEG, suddenly more than $800 million was staked on the chance of oil prices dropping. Fifteen minutes later, President Trump posted on Truth Social that the White House and Iran had very good and productive conversations about ending hostilities. The news sent the price of oil plummeting more than 10%. This could have resulted in tens of millions in profit, potentially $80 million.
Covel and others view this graph as a natural conclusion pointing to insider trading. 60 Minutes has learned that federal investigators are probing these oil market trades as well. If investigators go to the exchanges, they can identify who executed the trades. This could have been someone inside the US, someone from a foreign country, or an enemy. Identifying the individual would be key to determining whether it was insider trading.
Emmanuel Fabian, military correspondent for the Times of Israel, received a barrage of messages after publishing a piece in March about an Iranian missile strike in an empty forest near Jerusalem, with many asking him to change his story. One message stated he was going to make them lose $900,000 and that they would invest even more to finish him. The message also included details about his siblings and how often he visits his family. Fabian investigated and found war bets on Polymarket hinging on whether an Iranian missile would enter Israel specifically on March 10th. His small news story voided the side of the bets predicting no missile, angering the losers. There was $14 million wagered, which increased to $22 million by the time it closed.
Despite receiving death threats, Fabian did not change his copy. He reported the threats to police and to Polymarket, which stated that threatening a journalist was unacceptable and banned the accounts involved. Polymarket has stated they work proactively on any suspicious activity constantly behind the scenes.
Overseeing all this is the Commodity Futures Trading Commission (CFTC), a niche government agency set up in the 1970s to regulate food prices. Today it is run by one person, Michael Seelig, a 36-year-old whom President Trump nominated chairman last fall. Seelig stated they will hold whoever is engaging in fraudulent, manipulative, or insider trading activity accountable to the American people. However, enforcement actions have dropped by more than two-thirds since 2024, and staffing has dropped sharply as well. Seelig declined the interview request, though the CFTC stated it is hiring more staff and using AI to go after bad actors.
In March, the White House issued a memo to staffers noting it is a criminal offense for anyone to use non-public information on prediction markets. Source after source expressed fear that today's insider trading scandal is tomorrow's national security scandal. If market watchers can spot irregular trades, enemies can too, and they will make their war plans accordingly. This could be putting people's lives at risk, as other adversaries may be using this information to plan their own strategy. It is expected that cases like Sergeant Van Dyke's will multiply from here.
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