Polymarket is under the microscope again after a string of high-stakes geopolitical bets sparked fears that prediction markets are now being used to launder insider information into the public square. The drama picks up right where the infamous Maduro trade left off earlier this month.
An anonymous wallet turned a $30,000 wager into over $400,000 by betting Venezuela’s president would be ousted just hours before US forces captured him. President Donald Trump later confirmed a Venezuelan leaker connected to the operation was already behind bars. US President Donald Trump later said a Venezuelan leaker connected to the operation was already in jail.
Blockchain sleuths at Lookonchain revealed that two of the three wallets tied to those Maduro profits have been dormant for 11 days, fueling speculation that law enforcement or exchanges may have frozen the funds. The third wallet, however, has reawakened, placing a fresh bet two days ago predicting Iran’s Supreme Leader Ayatollah Ali Khamenei will be out of power by January 31.
Meanwhile, Polymarket traders have already taken a beating on Iran-related wagers. Earlier this week, a heavy “Yes” position bet the United States would strike Iran by January 14. As protests flared and Iran briefly closed its airspace, Polymarket odds spiked to 51%, with nearly $50 million in volume flooding the market. But the strike never came.
Iran reopened its airspace after four hours. President Trump said he had been told that protester executions had stopped. The market resolved “No,” wiping out 255,817 shares held by the trader and turning a potential $160,000 payout into a total loss of about $40,000.
That failed trade hasn’t eased concerns. Instead, analysts now argue some traders may be using Polymarket to shape, not just predict, geopolitical narratives. The tactic has been dubbed “information laundering.” It involves placing an early bet, letting copy-traders and social media amplify the trade, then flipping position once the market moves. Because Polymarket odds are widely shared on X and Telegram as real-time signals of geopolitical risk, a single well-timed bet can generate headlines, trigger trading bots, and sway sentiment before any public confirmation exists.
Lawmakers are already watching closely. After the Maduro trade, Representative Ritchie Torres introduced the Public Integrity in Financial Prediction Markets Act of 2026, which would ban US officials from trading on markets tied to government actions when they hold nonpublic information. The bill has dozens of House co-sponsors but has not yet moved to a vote and has no Senate companion.
So far, no evidence links the Iran trades to US insiders. But the pattern of sudden large bets, viral odds shifts, and rapid reversals is pushing prediction markets into a new and more dangerous spotlight. The risk now is not just who is betting, but how those bets themselves may be shaping what the world believes is about to happen.
