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) has uncovered evidence of a potential insider trading crisis in military and defense-related bets on Polymarket. The study analyzed over 435,000 markets and $54.4 billion in cumulative volume from January 2021 to mid-March 2026, and found that low-probability bets on military and defense outcomes have success rates that cannot be explained by skill or luck alone. In some cases, these bets have succeeded at rates of over 50%, significantly higher than the 14% success rate typically seen in political markets.
The report suggests that markets related to government policies, such as military and defense, are more susceptible to information asymmetries, including insider trading or specialized knowledge. This creates an environment in which a small group of informed traders can consistently outperform others. The ACDC report builds on existing research, which has shown that a small percentage of traders account for most price discovery on Polymarket, and that profits are highly concentrated among a tiny fraction of wallets.
The report examines the June 2025 U.S. strikes on Iran as a case study, finding that a small number of traders placed well-timed bets on the outcome, despite the Pentagon's efforts to keep the operation secret. The pattern of winning longshot bets in military and defense categories extends beyond this single event, with winning bets outnumbering losing ones in five of the six two-hour windows before market resolution.
The report's authors suggest that some participants may be operating with information advantages that others do not have, and recommend measures such as identity verification, conditional payouts, and restrictions on certain markets to prevent insider trading. Ultimately, the report calls for a broader debate about whether the public should be allowed to bet on military and defense outcomes at all.