Warning: Undefined array key "post_type_share_twitter_account" in /var/www/vhosts/casinonewsblogger.com/public_html/wp-content/themes/cryptocurrency/vslmd/share/share.php on line 24
Lawmakers in Congress are calling for a federal review of trades on Polymarket following a series of strategic bets placed shortly before major geopolitical announcements tied to the Iran war.
Rep. Ritchie Torres, a member of the House Financial Services Committee and its panel on digital assets, sent a letter Thursday to the Commodity Futures Trading Commission requesting an investigation into the timing of recent trades. The agency oversees derivatives markets, including prediction platforms.
“This pattern raises serious concerns that certain market participants may have had access to material nonpublic information regarding a market-moving geopolitical event,” Torres wrote.
In an interview with The Associated Press, he said: “What is the statistical likelihood of anyone other than an insider trader placing a winning bet 12 minutes before a market-moving presidential announcement? There are two answers: God or an insider trader. And something tells me that God is not placing bets around Donald Trump’s posts on Truth Social. “
Sen. Richard Blumenthal also sent a letter to Polymarket seeking information on trades tied to war and violence and measures to prevent insider participation.
“Polymarket has become an illicit market to sell and exploit national security secrets unlike any in history, and by extension a potential honeypot for foreign intelligence services watching for those same suspicious bets and wagers,” Blumenthal wrote.
Trades linked to Iran war spark debate
At least 50 newly created accounts placed large bets on a US-Iran ceasefire shortly before President Donald Trump announced the development late Tuesday on social media. These accounts made no other trades on the platform.
Other instances have drawn similar attention. In January, an anonymous user generated $400,000 in profit by wagering that Nicolas Maduro would be out of office hours before he was captured. Prior to the start of the Iran conflict, another account recorded roughly $550,000 in gains through trades tied to expectations that the US would strike Iran and that Ali Khamenei would be removed.
A study by Harvard University estimated that $143 million in profits on Polymarket may be linked to individuals with access to nonpublic information. The research relied on public blockchain data and covered events ranging from Taylor Swift’s engagement to the Nobel Peace Prize.
Concerns over prediction markets extend across party lines. Republican lawmakers have raised objections to event-based betting tied to geopolitical outcomes and have supported restrictions.
“We don’t want to imagine a world where America’s adversaries use prediction markets to anticipate our next move,” said Rep. Blake Moore.
At least two bipartisan bills, one in the House and one in the Senate, are under consideration.
Prediction platforms such as Kalshi and Polymarket allow users to trade on outcomes ranging from weather conditions to interest rate decisions.
Polymarket has limited availability in the US after a 2022 ban. The company is pursuing reentry through the acquisition of a CFTC-licensed exchange and clearinghouse, which would provide a pathway to offer contracts domestically. A limited rollout has begun.
The company also operates a crypto-based platform offshore that remains outside US jurisdiction and accounts for most activity.
Competitive landscape in event-based trading
The developments come at a time when prediction market operators are seeking a larger presence in the US, including in the sports segment.
Kalshi, which operates under US regulation, has outlined plans to become a leading prediction market. The company has introduced contracts tied to sports outcomes, drawing comparisons to traditional wagering.
Both companies have announced partnerships with sports organizations and media entities to extend distribution. The competitive environment also includes political connections. Donald Trump Jr. is an investor in Polymarket through 1789 Capital and serves as a paid strategic adviser to Kalshi.