- Polymarket processed $529 million in trades tied to the timing of U.S. and Israeli strikes on Iran.
- Six freshly created wallets collectively profited around $1 million by betting on strikes by February 28.
- Bubblemaps SA flagged the accounts as potential insider trading due to their timing and anonymity.
- Rival platform Kalshi said it would reimburse all fees from Iran-related bets.
As U.S. and Israeli bombs fell on Tehran last Friday, bettors on Polymarket were already cashing in. The prediction market processed $529 million in trades tied to the timing of the strikes, according to Bloomberg — and blockchain analysts are now flagging patterns that look a lot like insider trading.
Six Wallets, $1 Million, Zero History
Analytics firm Bubblemaps SA identified six accounts that collectively pocketed around $1 million by betting the U.S. would strike Iran by February 28. All six wallets were created in February. None had ever placed a bet on anything else. Some purchased shares at roughly $0.10 apiece just hours before the first explosions were reported in Tehran.
“The circulation of information involving war or conflict, coupled with Polymarket’s anonymity, can create incentives for informed participants to act early,” said Bubblemaps CEO Nicolas Vaiman. The implication is clear: someone with knowledge of the strikes’ timing turned that information into a six-figure payday.
Prediction Markets Have a War Profiteering Problem
This is not the first red flag. Back in January, analytics firm Polysights flagged a spike in bets around whether Iran’s Supreme Leader Ali Khamenei would still hold power by year’s end. The market effectively put a price tag on assassination — a feature, not a bug, of platforms where anything can become a tradeable contract.
Rival platform Kalshi moved to distance itself. “We don’t list markets directly tied to death,” CEO Tarek Mansour said. “When there are markets where potential outcomes involve death, we design the rules to prevent people from profiting from death.” Kalshi said it would reimburse all fees from its Iran-related bets.
No Regulatory Framework, No Accountability
Polymarket operates in a regulatory gray zone. The platform settled with the CFTC in 2022 for operating an unregistered trading facility but continues to serve non-U.S. users with minimal oversight. When the contracts being traded are tied to military strikes and geopolitical violence, the absence of enforceable insider trading rules transforms prediction markets from information tools into something far darker.
The $529 million in volume proves the demand exists. The six anonymous wallets prove the system can be gamed. What remains missing is anyone with the authority — or the will — to do something about it.
