The alleged $400,000 insider bet by a Green Beret on a Venezuelan raid, initially thought to be an isolated incident, may be just the tip of the iceberg. A recent report by the Anti-Corruption Data Collective, a nonprofit research group, analyzed over 435,000 Polymarket contracts and $54.4 billion in cumulative volume from January 2021 to mid-March 2026.
The findings suggest that low-probability bets on military and defense outcomes have succeeded at rates that defy explanation by skill or luck alone, with some cases seeing success rates above 50%. This discrepancy is particularly pronounced in markets tied to government policies, such as military and defense, and foreign affairs, which are inherently difficult to forecast using public information. As a result, these markets may be more vulnerable to information asymmetries, including insider trading or specialized knowledge. The gap between informed and uninformed traders in these markets may be significant, allowing a small group to consistently outperform others.
Polymarket has emphasized its market surveillance teams and cooperation with the Department of Justice, particularly in the Venezuela case, where trading on confidential knowledge is strictly prohibited. However, the report's findings contribute to a growing body of research indicating that a small percentage of traders account for most price discovery on Polymarket, with fewer than 1% of wallets capturing 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 across contracts that ultimately resolved YES, with eight wallets sharing about $1.8 million in profits. Despite the Pentagon's efforts to keep the operation covert, a small number of traders placed large, well-timed bets on the outcome. This pattern extends beyond a single event, with winning longshot bets outnumbering losing ones in five of the six two-hour windows before market resolution across Polymarket's military and defense category.
While longshot bets can outperform due to various factors, the consistency of these patterns, especially in markets tied to military decisions, suggests that some participants may have information advantages that others do not. 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 contract granularity.
Ultimately, the report calls for an informed debate on whether the public should be betting on these outcomes at all, given the potential for insider trading and market manipulation.