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 recent 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 exceeded 50% in some cases, are difficult to explain 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. This creates an environment where a small group of informed traders can consistently outperform others. The findings add to existing research, which shows that a small percentage of traders account for most price discovery and profits on Polymarket.
The ACDC report examines the June 2025 US 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 around $1.8 million for eight wallets. The report recommends measures such as identity verification, conditional payouts, and restrictions on certain markets to mitigate the risks of insider trading. Ultimately, the report calls for a broader debate on whether the public should be allowed to bet on these outcomes at all.