[ExI] Prediction market abuses by government agents

[Keith Henson]

Hours before U.S. Army Delta Force commandos captured Venezuelan
President Nicolás Maduro and his wife during a nighttime raid in
Caracas, an anonymous trader, using a newly created account on the
prediction market Polymarket, wagered more than $30,000 that Maduro
would be out of office by Jan. 31, 2026. The trader walked away with
more than $400,000 in profit.

The best of The Post’s opinions and commentary, in your inbox every morning

This was no ordinary bet on sports, weather, entertainment or trivia.
It was a wager on matters of war and peace — among the gravest
decisions a government can make. The “prediction” was timed with such
pitch-perfect precision that it drew heavy media scrutiny and put
prediction markets squarely in the spotlight. The transaction bore the
hallmarks of insider trading. While the identity of the trader remains
unknown, the mere possibility that a government insider could have
pocketed more than $400,000 should be reason enough for Congress to
act.

There may be no greater cesspool of corruption in the making than the
intersection of prediction markets and the federal government.
Concerns that once appeared theoretical are becoming real risks.

Follow Trump’s second term

Public officials, political appointees or staff may gain access to
sensitive, nonpublic information — and then leverage it for personal
profit in largely deregulated markets. These are not fanciful
hypotheticals but flashing warning signs of a system vulnerable to
abuse if left unchecked.

The potential for corruption is not limited to national security or
foreign policy. On Jan. 7, traders wagered on whether the White House
press briefing would last longer than 65 minutes. The market assigned
a 98 percent probability that it would. Then, with seconds to spare,
the briefing was abruptly ended — delivering massive, near-instant
payouts to those betting against the odds. Whether coincidental or
not, the episode underscored just how potentially vulnerable official
government proceedings are to being parlayed into opportunities for
profit. No government action, not even the length of a White House
press briefing, is too mundane or minute to be monetized.

In prediction markets, users can wager on military operations,
sanctions, regulatory actions, leadership changes, court rulings or
legislation. A government insider could bet on whether a foreign
leader will be removed, when a military strike will occur, if a
regulation will be enacted, repealed or delayed, or whether Congress
will pass — or block — a bill. In each case, the bettor could
conceivably be in a position to shape the outcome on which they are
wagering. There are Polymarket users currently putting money on
whether the United States will acquire Greenland in 2026, whether NATO
will dissolve before 2027 and whether Ayatollah Ali Khamenei will be
ousted as ruler of Iran by Jan. 31.

Imagine, for a moment, that a member of the Trump administration
placed a bet predicting an event such as the removal of Maduro. As
both a government insider and a participant in prediction markets,
that individual would face a perverse incentive to advance policies
that could line his or her own pockets. Prediction-market profiteering
by elected officials and government employees must be prohibited —
period. The blurred line between predicting and profiting does not
merely corrupt markets; it has the potential to corrupt government
itself, transforming public service into a private enterprise. Just as
President Donald Trump has used crypto ventures to enrich himself and
his family, there is reason to fear that government insiders could do
the same through prediction markets.

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That is why I have introduced legislation intended to crack down on
insider trading in prediction markets. The Public Integrity in
Financial Prediction Markets Act would prohibit employees and elected
officials in both Congress and the executive branch from buying or
selling prediction market contracts tied to government action.
Polymarket bans all U.S. traders from wagering on their site, but many
users employ a VPN to easily obscure their location data. Kalshi,
another major prediction market, says its platform informs users that
insider trading is against its terms of service. But terms of service
are no substitute for laws.

For government insiders, the word “prediction” is a misnomer. If
elected officials or government employees are making these decisions —
or shaping them — they are not forecasting the future, they are
shaping it. If they wager on the outcome, then they would be governing
for profit.

To be clear, none of these concerns are meant to discredit prediction
markets themselves, but rather the abuse of them by those in power.
When properly designed and regulated, prediction markets can
efficiently aggregate information and generate valuable insights. But
if government officials trade on their own decisions, public service
ceases to serve the public. A bet on government action by a government
actor is always a bet against the public interest — regardless of the
outcome.

Hours before U.S. Army Delta Force commandos captured Venezuelan
President Nicolás Maduro and his wife during a nighttime raid in
Caracas, an anonymous trader, using a newly created account on the
prediction market Polymarket, wagered more than $30,000 that Maduro
would be out of office by Jan. 31, 2026. The trader walked away with
more than $400,000 in profit. The best of The Post’s opinions and
commentary, in your inbox every morning  This was no ordinary bet on
sports, weather, entertainment or trivia. It was a wager on matters of
war and peace — among the gravest decisions a government can make. The
“prediction” was timed with such pitch-perfect precision that it drew
heavy media scrutiny and put prediction markets squarely in the
spotlight. The transaction bore the hallmarks of insider trading.
While the identity of the trader remains unknown, the mere possibility
that a government insider could have pocketed more than $400,000
should be reason enough for Congress to act.  There may be no greater
cesspool of corruption in the making than the intersection of
prediction markets and the federal government. Concerns that once
appeared theoretical are becoming real risks.  Follow Trump’s second
term  Public officials, political appointees or staff may gain access
to sensitive, nonpublic information — and then leverage it for
personal profit in largely deregulated markets. These are not fanciful
hypotheticals but flashing warning signs of a system vulnerable to
abuse if left unchecked.  The potential for corruption is not limited
to national security or foreign policy. On Jan. 7, traders wagered on
whether the White House press briefing would last longer than 65
minutes. The market assigned a 98 percent probability that it would.
Then, with seconds to spare, the briefing was abruptly ended —
delivering massive, near-instant payouts to those betting against the
odds. Whether coincidental or not, the episode underscored just how
potentially vulnerable official government proceedings are to being
parlayed into opportunities for profit. No government action, not even
the length of a White House press briefing, is too mundane or minute
to be monetized.  In prediction markets, users can wager on military
operations, sanctions, regulatory actions, leadership changes, court
rulings or legislation. A government insider could bet on whether a
foreign leader will be removed, when a military strike will occur, if
a regulation will be enacted, repealed or delayed, or whether Congress
will pass — or block — a bill. In each case, the bettor could
conceivably be in a position to shape the outcome on which they are
wagering. There are Polymarket users currently putting money on
whether the United States will acquire Greenland in 2026, whether NATO
will dissolve before 2027 and whether Ayatollah Ali Khamenei will be
ousted as ruler of Iran by Jan. 31.  Imagine, for a moment, that a
member of the Trump administration placed a bet predicting an event
such as the removal of Maduro. As both a government insider and a
participant in prediction markets, that individual would face a
perverse incentive to advance policies that could line his or her own
pockets. Prediction-market profiteering by elected officials and
government employees must be prohibited — period. The blurred line
between predicting and profiting does not merely corrupt markets; it
has the potential to corrupt government itself, transforming public
service into a private enterprise. Just as President Donald Trump has
used crypto ventures to enrich himself and his family, there is reason
to fear that government insiders could do the same through prediction
markets. Popular from Opinions Opinion Maryellen MacDonald Gen Zers
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it could cost them January 11, 2026 Opinion Editorial Board Jack Smith
would have blown a hole in the First Amendment Jack Smith would have
blown a hole in the First Amendment January 9, 2026 Opinion George F.
Will A president who treats Washington like his chew toy A president
who treats Washington like his chew toy January 9, 2026 Opinion
Editorial Board Pete Hegseth went after Mark Kelly. He whiffed. Pete
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Reza Pahlavi Reza Pahlavi: Iran is ready for a democratic transition
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Jesse Rifkin I perform at a piano bar. The most requested song might
surprise you. I perform at a piano bar. The most requested song might
surprise you. December 26, 2025 Opinion Jim Geraghty Ben Sasse is
exiting the stage far too soon Ben Sasse is exiting the stage far too
soon December 28, 2025  That is why I have introduced legislation
intended to crack down on insider trading in prediction markets. The
Public Integrity in Financial Prediction Markets Act would prohibit
employees and elected officials in both Congress and the executive
branch from buying or selling prediction market contracts tied to
government action. Polymarket bans all U.S. traders from wagering on
their site, but many users employ a VPN to easily obscure their
location data. Kalshi, another major prediction market, says its
platform informs users that insider trading is against its terms of
service. But terms of service are no substitute for laws.  For
government insiders, the word “prediction” is a misnomer. If elected
officials or government employees are making these decisions — or
shaping them — they are not forecasting the future, they are shaping
it. If they wager on the outcome, then they would be governing for
profit.  To be clear, none of these concerns are meant to discredit
prediction markets themselves, but rather the abuse of them by those
in power. When properly designed and regulated, prediction markets can
efficiently aggregate information and generate valuable insights. But
if government officials trade on their own decisions, public service
ceases to serve the public. A bet on government action by a government
actor is always a bet against the public interest — regardless of the
outcome.Hours before U.S. Army Delta Force commandos captured
Venezuelan President Nicolás Maduro and his wife during a nighttime
raid in Caracas, an anonymous trader, using a newly created account on
the prediction market Polymarket, wagered more than $30,000 that
Maduro would be out of office by Jan. 31, 2026. The trader walked away
with more than $400,000 in profit.The best of The Post’s opinions and
commentary, in your inbox every morningThis was no ordinary bet on
sports, weather, entertainment or trivia. It was a wager on matters of
war and peace — among the gravest decisions a government can make. The
“prediction” was timed with such pitch-perfect precision that it drew
heavy media scrutiny and put prediction markets squarely in the
spotlight. The transaction bore the hallmarks of insider trading.
While the identity of the trader remains unknown, the mere possibility
that a government insider could have pocketed more than $400,000
should be reason enough for Congress to act.There may be no greater
cesspool of corruption in the making than the intersection of
prediction markets and the federal government. Concerns that once
appeared theoretical are becoming real risks.Follow Trump’s second
termPublic officials, political appointees or staff may gain access to
sensitive, nonpublic information — and then leverage it for personal
profit in largely deregulated markets. These are not fanciful
hypotheticals but flashing warning signs of a system vulnerable to
abuse if left unchecked.The potential for corruption is not limited to
national security or foreign policy. On Jan. 7, traders wagered on
whether the White House press briefing would last longer than 65
minutes. The market assigned a 98 percent probability that it would.
Then, with seconds to spare, the briefing was abruptly ended —
delivering massive, near-instant payouts to those betting against the
odds. Whether coincidental or not, the episode underscored just how
potentially vulnerable official government proceedings are to being
parlayed into opportunities for profit. No government action, not even
the length of a White House press briefing, is too mundane or minute
to be monetized.In prediction markets, users can wager on military
operations, sanctions, regulatory actions, leadership changes, court
rulings or legislation. A government insider could bet on whether a
foreign leader will be removed, when a military strike will occur, if
a regulation will be enacted, repealed or delayed, or whether Congress
will pass — or block — a bill. In each case, the bettor could
conceivably be in a position to shape the outcome on which they are
wagering. There are Polymarket users currently putting money on
whether the United States will acquire Greenland in 2026, whether NATO
will dissolve before 2027 and whether Ayatollah Ali Khamenei will be
ousted as ruler of Iran by Jan. 31.Imagine, for a moment, that a
member of the Trump administration placed a bet predicting an event
such as the removal of Maduro. As both a government insider and a
participant in prediction markets, that individual would face a
perverse incentive to advance policies that could line his or her own
pockets. Prediction-market profiteering by elected officials and
government employees must be prohibited — period. The blurred line
between predicting and profiting does not merely corrupt markets; it
has the potential to corrupt government itself, transforming public
service into a private enterprise. Just as President Donald Trump has
used crypto ventures to enrich himself and his family, there is reason
to fear that government insiders could do the same through prediction
markets.Popular from OpinionsOpinionMaryellen MacDonaldGen Zers aren’t
talking — and it could cost themGen Zers aren’t talking — and it could
cost themJanuary 11, 2026OpinionEditorial BoardJack Smith would have
blown a hole in the First AmendmentJack Smith would have blown a hole
in the First AmendmentJanuary 9, 2026OpinionGeorge F. WillA president
who treats Washington like his chew toyA president who treats
Washington like his chew toyJanuary 9, 2026OpinionEditorial BoardPete
Hegseth went after Mark Kelly. He whiffed.Pete Hegseth went after Mark
Kelly. He whiffed.January 6, 2026OpinionReza PahlaviReza Pahlavi: Iran
is ready for a democratic transitionReza Pahlavi: Iran is ready for a
democratic transitionJanuary 6, 2026OpinionGeorge F. WillTrump goes
monster-hunting, untainted by a whiff of legalityTrump goes
monster-hunting, untainted by a whiff of legalityJanuary 3,
2026OpinionMarc ThiessenThe 20 best things Trump did in 2025The 20
best things Trump did in 2025January 3, 2026OpinionMichael S. RothThe
epidemic of toxic flattery is spreadingThe epidemic of toxic flattery
is spreadingDecember 29, 2025OpinionJesse RifkinI perform at a piano
bar. The most requested song might surprise you.I perform at a piano
bar. The most requested song might surprise you.December 26,
2025OpinionJim GeraghtyBen Sasse is exiting the stage far too soonBen
Sasse is exiting the stage far too soonDecember 28, 2025That is why I
have introduced legislation intended to crack down on insider trading
in prediction markets. The Public Integrity in Financial Prediction
Markets Act would prohibit employees and elected officials in both
Congress and the executive branch from buying or selling prediction
market contracts tied to government action. Polymarket bans all U.S.
traders from wagering on their site, but many users employ a VPN to
easily obscure their location data. Kalshi, another major prediction
market, says its platform informs users that insider trading is
against its terms of service. But terms of service are no substitute
for laws.For government insiders, the word “prediction” is a misnomer.
If elected officials or government employees are making these
decisions — or shaping them — they are not forecasting the future,
they are shaping it. If they wager on the outcome, then they would be
governing for profit.To be clear, none of these concerns are meant to
discredit prediction markets themselves, but rather the abuse of them
by those in power. When properly designed and regulated, prediction
markets can efficiently aggregate information and generate valuable
insights. But if government officials trade on their own decisions,
public service ceases to serve the public. A bet on government action
by a government actor is always a bet against the public interest —
regardless of the outcome.Hours before U.S. Army Delta Force commandos
captured Venezuelan President Nicolás Maduro and his wife during a
nighttime raid in Caracas, an anonymous trader, using a newly created
account on the prediction market Polymarket, wagered more than $30,000
that Maduro would be out of office by Jan. 31, 2026. The trader walked
away with more than $400,000 in profit.The best of The Post’s opinions
and commentary, in your inbox every morningThis was no ordinary bet on
sports, weather, entertainment or trivia. It was a wager on matters of
war and peace — among the gravest decisions a government can make. The
“prediction” was timed with such pitch-perfect precision that it drew
heavy media scrutiny and put prediction markets squarely in the
spotlight. The transaction bore the hallmarks of insider trading.
While the identity of the trader remains unknown, the mere possibility
that a government insider could have pocketed more than $400,000
should be reason enough for Congress to act.There may be no greater
cesspool of corruption in the making than the intersection of
prediction markets and the federal government. Concerns that once
appeared theoretical are becoming real risks.Follow Trump’s second
termPublic officials, political appointees or staff may gain access to
sensitive, nonpublic information — and then leverage it for personal
profit in largely deregulated markets. These are not fanciful
hypotheticals but flashing warning signs of a system vulnerable to
abuse if left unchecked.The potential for corruption is not limited to
national security or foreign policy. On Jan. 7, traders wagered on
whether the White House press briefing would last longer than 65
minutes. The market assigned a 98 percent probability that it would.
Then, with seconds to spare, the briefing was abruptly ended —
delivering massive, near-instant payouts to those betting against the
odds. Whether coincidental or not, the episode underscored just how
potentially vulnerable official government proceedings are to being
parlayed into opportunities for profit. No government action, not even
the length of a White House press briefing, is too mundane or minute
to be monetized.In prediction markets, users can wager on military
operations, sanctions, regulatory actions, leadership changes, court
rulings or legislation. A government insider could bet on whether a
foreign leader will be removed, when a military strike will occur, if
a regulation will be enacted, repealed or delayed, or whether Congress
will pass — or block — a bill. In each case, the bettor could
conceivably be in a position to shape the outcome on which they are
wagering. There are Polymarket users currently putting money on
whether the United States will acquire Greenland in 2026, whether NATO
will dissolve before 2027 and whether Ayatollah Ali Khamenei will be
ousted as ruler of Iran by Jan. 31.Imagine, for a moment, that a
member of the Trump administration placed a bet predicting an event
such as the removal of Maduro. As both a government insider and a
participant in prediction markets, that individual would face a
perverse incentive to advance policies that could line his or her own
pockets. Prediction-market profiteering by elected officials and
government employees must be prohibited — period. The blurred line
between predicting and profiting does not merely corrupt markets; it
has the potential to corrupt government itself, transforming public
service into a private enterprise. Just as President Donald Trump has
used crypto ventures to enrich himself and his family, there is reason
to fear that government insiders could do the same through prediction
markets.Popular from OpinionsOpinionMaryellen MacDonaldGen Zers aren’t
talking — and it could cost themGen Zers aren’t talking — and it could
cost themJanuary 11, 2026OpinionEditorial BoardJack Smith would have
blown a hole in the First AmendmentJack Smith would have blown a hole
in the First AmendmentJanuary 9, 2026OpinionGeorge F. WillA president
who treats Washington like his chew toyA president who treats
Washington like his chew toyJanuary 9, 2026OpinionEditorial BoardPete
Hegseth went after Mark Kelly. He whiffed.Pete Hegseth went after Mark
Kelly. He whiffed.January 6, 2026OpinionReza PahlaviReza Pahlavi: Iran
is ready for a democratic transitionReza Pahlavi: Iran is ready for a
democratic transitionJanuary 6, 2026OpinionGeorge F. WillTrump goes
monster-hunting, untainted by a whiff of legalityTrump goes
monster-hunting, untainted by a whiff of legalityJanuary 3,
2026OpinionMarc ThiessenThe 20 best things Trump did in 2025The 20
best things Trump did in 2025January 3, 2026OpinionMichael S. RothThe
epidemic of toxic flattery is spreadingThe epidemic of toxic flattery
is spreadingDecember 29, 2025OpinionJesse RifkinI perform at a piano
bar. The most requested song might surprise you.I perform at a piano
bar. The most requested song might surprise you.December 26,
2025OpinionJim GeraghtyBen Sasse is exiting the stage far too soonBen
Sasse is exiting the stage far too soonDecember 28, 2025That is why I
have introduced legislation intended to crack down on insider trading
in prediction markets. The Public Integrity in Financial Prediction
Markets Act would prohibit employees and elected officials in both
Congress and the executive branch from buying or selling prediction
market contracts tied to government action. Polymarket bans all U.S.
traders from wagering on their site, but many users employ a VPN to
easily obscure their location data. Kalshi, another major prediction
market, says its platform informs users that insider trading is
against its terms of service. But terms of service are no substitute
for laws.For government insiders, the word “prediction” is a misnomer.
If elected officials or government employees are making these
decisions — or shaping them — they are not forecasting the future,
they are shaping it. If they wager on the outcome, then they would be
governing for profit.To be clear, none of these concerns are meant to
discredit prediction markets themselves, but rather the abuse of them
by those in power. When properly designed and regulated, prediction
markets can efficiently aggregate information and generate valuable
insights. But if government officials trade on their own decisions,
public service ceases to serve the public. A bet on government action
by a government actor is always a bet against the public interest —
regardless of the outcome.

Washington Post Jan 15

Best wishes,

Keith