The news of a US military strike on Iran sent shockwaves through global markets, but before the explosions occurred, some individuals had already quietly positioned themselves in prediction markets.
According to a recent disclosure by blockchain analysis firm Bubblemaps, six accounts on the Polymarket platform, suspected of insider trading, concentrated their bets on "Yes" hours before the US airstrike on Iran, collectively profiting approximately $1.2 million. All these accounts were registered in February, with most wallets receiving their first deposits only within the 24 hours preceding the attack. Beyond these specific bets, the accounts showed no other transaction history.
This incident has drawn significant attention to regulatory vulnerabilities in prediction platforms. Concurrently, the US Commodity Futures Trading Commission (CFTC) issued a warning last week regarding insider trading in prediction markets, indicating rising regulatory pressure.
On February 28th, the US and Israel launched a large-scale joint military strike against Iran. On the same day, former President Donald Trump confirmed in a video posted on Truth Social that US forces had initiated a "major combat operation" against Iran, directly addressing Tehran with a message to "take over your government" once the operation concluded.
Following the public announcement, the price of Bitcoin declined, while oil futures on the Hyperliquid platform rose due to expectations of escalating regional conflict. Trading volume for this contract market approached $90 million on February 28th alone. Since December of the previous year, cumulative trading volume for contracts related to the potential date of a US strike on Iran has exceeded $529 million, highlighting the market's intense focus on this geopolitical event.
**Six Accounts Make Accurate Bets, Profiting $1.2 Million**
An analytical report published by Bubblemaps on social media platform X revealed that six Polymarket accounts heavily purchased "Yes" shares on the contract market asking "Will the US strike Iran before February 28, 2026?". They realized their profits after the market settled at $1 per share, with total gains around $1.2 million.
One account purchased over 560,000 "Yes" shares at an average price of approximately 10.8 cents, ultimately profiting nearly $560,000. Another account bought nearly 150,000 shares at 20 cents, also recording a six-figure gain. A visualization chart released by Bubblemaps indicated clear connections between the six wallets, with highly similar funding paths.
All these accounts were created in February, with most making their initial deposits just hours before the attack occurred. Their transaction history showed no activity other than this specific bet, a pattern highly consistent with typical insider trading characteristics.
Separately, a post on social media platform X by MikeLevin disclosed that one of the six accounts, named "Magamyman" on Polymarket, earned a single-day profit of $515,000. Its first transaction occurred 71 minutes before the relevant news was publicly disclosed. At that time, the market was pricing the probability of a US strike on Iran at only 17%. The account entered the market with approximately $87,000 and profited over $500,000 overnight.
Notably, MikeLevin's post also pointed out that Donald Trump Jr. currently serves on Polymarket's advisory board, and his company invested tens of millions of dollars in the platform last year. Furthermore, both the US Department of Justice and the CFTC had previously investigated Polymarket, but these investigations were reportedly dropped following Trump's inauguration. The post called for relevant parties to provide explanations and urged greater transparency and regulatory follow-up.
**Regulatory Pressure Mounts as Prediction Market Insider Trading Concerns Surface**
This incident comes as US regulators are increasing scrutiny of insider trading activities within prediction markets.
Polymarket's competitor, Kalshi, announced this week that it had suspended and penalized two users suspected of insider trading. One individual, a visual effects editor for MrBeast's show "Beast Games," was accused of trading using non-public information about the show's outcome, resulting in a two-year ban and a fine exceeding $20,000. Another case involved a political candidate placing bets on an election contract for their own race.
Kalshi stated that it has investigated approximately 200 cases, with over ten investigations still active. Subsequently, the CFTC issued a statement warning that insider trading on event contracts may violate US law, with Chairman Rostin Behnam positioning exchanges as the "first line of defense."
Meanwhile, the issue of insider trading on the Polymarket platform is not new. Last week, blockchain investigator ZachXBT previewed an investigative report on a certain crypto platform, sparking market speculation and leading to the creation of a Polymarket contract betting on "which company will be named." According to identification by Lookonchain, 12 wallets had heavily bet on Axiom before the investigation results were published; employees of the company were accused of trading using non-public information.
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