The alleged insider trading incident involving a Green Beret, who placed a $400,000 bet on a Venezuelan raid, may be just the tip of the iceberg. A comprehensive analysis of over 435,000 Polymarket contracts and $54.4 billion in cumulative volume by the Anti-Corruption Data Collective (ACDC) reveals that low-probability bets on military and defense outcomes have won at rates that defy explanation by skill or luck alone. Typically, such 'longshot' bets succeed around 14% of the time, but in military-linked contracts, success rates have exceeded 50% in some cases.
This discrepancy suggests that certain traders may be operating with an information advantage, potentially due to insider trading or specialized knowledge. The ACDC report's findings are consistent with existing research, which shows that a small group of traders, roughly 3%, drive price discovery on Polymarket, while fewer than 1% of wallets capture about half of all gains.
The study 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 in the affirmative, resulting in profits of about $1.8 million for eight wallets. The consistency of these patterns, particularly in markets tied to military decisions, implies that some participants may be exploiting information advantages not available to others.
To address these concerns, the ACDC recommends implementing 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 a fact-based discussion on whether the public should be allowed to bet on these outcomes at all.