AP: Polymarket bets on Iran-US ceasefire Raise insider trading fears

A cluster of newly created accounts on the prediction market Polymarket made highly targeted and timely bets on a ceasefire between the United States and Iran on April 7, generating hundreds of thousands of dollars in profits and raising fresh concerns about potential insider trading, Associated Press reports.

The wagers were placed despite escalating rhetoric from US President Donald Trump in the hours leading up to the announcement. Earlier that day, Trump warned on social media that “a whole civilization will die tonight” if Iran failed to comply with his demand to open the Strait of Hormuz by an 8 p.m. ET deadline. Few public signals suggested a ceasefire was imminent before his announcement on Truth Social at approximately 6:30 p.m. ET.

An analysis of publicly available blockchain data from Polymarket, conducted using the crypto analytics platform Dune Analytics, found that at least 50 wallets placed significant “Yes” bets on the ceasefire outcome earlier that day. Notably, these were the first recorded transactions for those accounts.

One wallet, created around 10 a.m. ET, reportedly placed about $72,000 in bets at an average price of 8.8 cents—implying low perceived odds of a ceasefire—and later exited with an estimated profit of $200,000. Another wallet, created just 12 minutes before Trump’s announcement, invested $31,908 at 33.7 cents and is believed to have earned roughly $48,500.

Market pricing on Polymarket ranges from $0 to $1 per contract, reflecting probabilities from 0% to 100%. The higher “Yes” price later in the day may have been influenced by diplomatic efforts, including a reported attempt by Pakistan to persuade Washington to extend its deadline.

Some observers suggested that traders may have anticipated a reversal in Trump’s position, citing a pattern critics have labeled “Trump Always Chickens Out,” or TACO. However, the timing and precision of the bets have intensified scrutiny.

Polymarket has since marked the April 7 ceasefire contract as “disputed,” noting ongoing hostilities and continued Iranian restrictions on maritime traffic through the Strait of Hormuz. The dispute resolution process could take up to 48 hours, delaying payouts for some users.

Because Polymarket operates using proxy smart contract wallets, it is not possible to determine from public data whether the accounts belong to new users or existing traders creating additional wallets. The company has not responded to requests for comment.

Lawmakers have raised alarms. “It’s highly unlikely that these are good-faith trades; it’s much more likely that these are insiders with access to information ahead of the public,” said Blake Moore. “Without some kind of restrictions, there is nothing stopping government or military officials from profiting from their positions.”

The pattern mirrors previous incidents on the platform, including large, well-timed bets ahead of the January capture of Nicolás Maduro, as well as repeated profitable trades tied to military developments involving Iran.

These episodes have prompted bipartisan efforts in Congress to expand the legal definition of insider trading to cover prediction markets. Even major platforms in the sector, including Polymarket and Kalshi, have acknowledged the need for clearer rules.

“This is why these markets need regulation,” said Todd Phillips. “We can’t have people trading with inside information and expect other traders are going to be OK being in these markets.”

By Vafa Guliyeva