The alleged $400,000 insider bet by a Green Beret on a Venezuela raid, initially perceived as an isolated incident, may be just the tip of the iceberg. A comprehensive analysis conducted by the Anti-Corruption Data Collective, a nonprofit research organization, covering over 435,000 Polymarket contracts from January 2021 to mid-March 2026, has uncovered a disturbing trend.
Low-probability bets on military and defense outcomes have achieved success rates that defy explanation by skill or luck alone, with some cases reaching success rates of over 50%, significantly higher than the 14% average for such "longshot" bets across political markets. The study suggests that markets tied to government policies, particularly those related to military and defense, are more susceptible to information asymmetries, including insider trading.
This creates an environment where a small group of informed traders can consistently outperform others, not just by reacting faster, but by possessing more knowledge. The findings add to a growing body of research indicating that a small percentage of traders, approximately 3%, drive most price discovery on Polymarket, with fewer than 1% of wallets capturing about half of all gains. The report highlights the June 2025 U.S. strikes on Iran as a case study, where despite the operation's secrecy, a small number of traders placed well-timed, large bets on the outcome, suggesting potential information advantages.
The pattern of winning longshot bets outnumbering losing ones in the hours leading up to market resolution, especially in military and defense categories, raises concerns about the integrity of these markets. The researchers recommend identity verification for bettors, conditional payouts on suspicious wagers, and restrictions on markets whose outcomes are decided by small groups, questioning whether the public should be allowed to bet on such outcomes at all.