The alleged insider trading incident involving a Green Beret's $400,000 bet on a Venezuelan raid may be just the tip of the iceberg. A new report by the Anti-Corruption Data Collective (ACDC) analyzed over 435,000 Polymarket contracts and $54.4 billion in trading volume, revealing unusually high win rates for low-probability bets on military and defense outcomes.
These success rates, which have reached as high as 50% in some cases, cannot be easily explained by skill or luck alone. The report suggests that markets related to government policies, such as military and defense, are more susceptible to information asymmetries, including insider trading and specialized knowledge. This creates an environment where a small group of informed traders can consistently outperform others.
The findings are consistent with previous research, which found that roughly 3% of traders account for most price discovery on Polymarket, and that fewer than 1% of wallets capture about half of all gains. The report examines the June 2025 U.S. strikes on Iran as a case study, where 19 longshot bets totaling $164,292 were placed in the hours leading up to the strike, resulting in profits of $1.8 million for eight wallets. The pattern of well-timed bets on military and defense outcomes extends beyond this single event, with winning longshot bets outnumbering losing ones in five of the six two-hour windows before market resolution.
The report recommends identity verification for bettors, conditional payouts on suspicious wagers, restrictions on markets whose outcomes are decided by small groups, and limits on how granular contracts can become. Ultimately, the report calls for an evidence-informed debate about whether the public should be betting on these outcomes at all.