The “U.S. forces enter Iran by” contract on Polymarket (1) has attracted more than $99.9 million in trading volume since it launched in January — and as of Thursday morning, the market currently assigns a 62% probability that American troops will set foot on Iranian territory by April 30. Among the traders positioning for that outcome is at least one account that stands to collect a seven-figure payout if it happens.
If the name of this game sounds familiar, it should. Just weeks ago, blockchain analytics firm Bubblemaps flagged six freshly created Polymarket accounts (2) that collectively netted roughly $1.2 million by correctly betting the U.S. would strike Iran on February 28 — the exact day (3) coordinated U.S.-Israeli airstrikes began. Most of those wallets were funded within 24 hours of the attack, and their bets were placed hours before the first bombs fell.
One account alone turned roughly $61,000 into more than $493,000 in profit (4), according to CoinDesk. A separate account trading under the name “Magamyman” earned more than $553,000 betting on the death of Iran’s Supreme Leader Ali Khamenei (5) shortly before an Israeli strike killed him, according to NPR.
Then there’s the trader CNN identified (6), with the help of Bubblemaps, who won 93% of their five-figure wagers on Iran since 2024, netting nearly $967,000 — even though the events they predicted were unannounced military operations. Todd Phillips, a finance professor at Georgia State University and former Commodity Futures Trading Commission (CFTC) advisory board member, told CNN the win rate was a red flag, adding most high-frequency traders hover just above 50%.
Prediction markets work like stock markets, except what you’re buying and selling are contracts tied to real-world events rather than company earnings. You purchase “yes” or “no” shares at a price that reflects the crowd’s estimated probability. If you’re right, each share pays out $1. If you’re wrong, you lose your stake.
The model has legitimate applications. Proponents argue these markets aggregate dispersed information more effectively than polls or pundits can. But when the event being traded on is a military operation — planned in secret and executed without public warning — the pool of people who could reasonably “predict” it narrows considerably.
That’s the core tension now gripping Washington. Bubblemaps CEO Nicolas Vaiman told Newsweek (7) that in military situations, planning involves officials, advisers, officers and sometimes multiple countries, meaning the number of people who might know something in advance can be large. Combine that with anonymous access to a market that lets you bet directly on a specific event, he said, and the temptation is obvious.
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The backlash has been swift. On March 31, the CFTC’s new enforcement director, David Miller, declared at New York University School of Law (8) that insider trading in prediction markets is now a top enforcement priority, and that the belief that such laws don’t apply to these platforms is flat wrong.
On Capitol Hill, lawmakers have introduced a flurry of bills.
Sen. Adam Schiff’s DEATH BETS Act (9) would ban any CFTC-registered exchange from listing contracts tied to war, terrorism, assassination or death. A separate bipartisan measure, the PREDICT Act (10), targets the misuse of classified information on prediction platforms. And Sens. Jeff Merkley and Elizabeth Warren, along with Rep. Jamie Raskin, introduced the STOP Corrupt Bets Act (11), which would ban prediction market bets on elections, sports, war and government actions entirely.
Whether any of it passes a Republican-controlled Congress is another matter. And the platform at the center of all of this has powerful allies: Donald Trump Jr. serves as an adviser to Polymarket (5) and his venture capital firm 1789 Capital has invested in the company, according to NPR. The Trump administration also closed two federal investigations (5) into Polymarket that were opened under President Biden.
As it stands, more than 50,000 American troops (12) are now positioned across the Middle East. The Pentagon is reported to be drawing up contingency plans (13) for limited ground raids on targets like Kharg Island and coastal sites near the Strait of Hormuz, though no order has been approved. And on Polymarket, the money keeps flowing in.
The market’s defenders say this is price discovery. Its critics call it something else: a place where people with access to state secrets can turn classified intelligence into cash, anonymously, with virtually no risk of getting caught.
More than half a billion dollars has now been wagered on the timing of U.S. strikes against Iran alone (1).
Polymarket CEO Shayne Coplan told CBS News (14) that insiders having an edge is “a good thing” because it accelerates price discovery, but whether that logic holds when the commodity being traded is war is a question Congress will soon have to answer.
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Polymarket (1); The Block (2); Al Jazeera (3); CoinDesk (4); NPR (5); CNN (6); Newsweek (7); Fortune (8); Adam Schiff (9); CoinCentral (10); Jamie Raskin (11); Bitcoin.com (12); The Washington Post (13); CBS News (14)
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