Insider Trading Risks: US Military Secrets Exposed on Prediction Markets

The world of prediction markets is currently being rocked by a major controversy that goes far beyond the usual questions of fairness. It is no longer just about whether these platforms should be classified as gambling, but about the national security of the United States. A recent report by the Anti-Corruption Data Collective (ACDC) sheds light on a dark reality where government insiders and military personnel may be using their secret knowledge to enrich themselves at the expense of security. Platforms like Polymarket are at the center of investigations, as bets are specifically placed on the outcomes of military conflicts before they are even publicly known.

The problem is multifaceted and threatening. First, there is an urgent suspicion that information is being misused directly from government circles. Second, accounts that correctly predict the outcome of military actions every time signal sensitive US secrets to foreign adversaries. This poses a significant risk to the lives of servicemen and women. Third, the question remains whether information is even being deliberately spread by foreign actors to sabotage operations. The ACDC calls these highly specialized and extremely successful bettors Orcas, as they strike with lightning speed and then disappear back into the depths of the blockchain.

Numbers and facts

The ACDC's statistical evaluations are alarming. The report identified at least 152 cryptocurrency wallets that traded contracts on Polymarket related to undisclosed US military actions. These accounts, classified as Orcas, have an incredible success rate of 97.2 percent. On average, these wallets won about $52,514 per account. In total, the profit of this suspicious group amounts to around $8 million, while they collectively risked only about $2 million. This discrepancy between risk and profit leaves little other conclusion than that of insider trading.

In addition to the Orcas, whales, i.e. large-scale bettors, and automated bots were also identified. A particularly striking case occurred in connection with Venezuela. A US soldier used privileged information about the planned capture of President Nicolás Maduro for trades. Such incidents show that the barrier between state secrecy and private greed is increasingly blurring on crypto platforms.

"Only unmasking the true identity of the users with the subpoena power held by law enforcement agencies can definitively identify the true insiders." - ACDC spokesperson, Anti-Corruption Report

Background

The US Commodity Futures Trading Commission (CFTC) issued its first official advisory on event contracts on March 12, 2026. This happened under the new chairman Michael Selig. The CFTC is responding to a flood of suspicious bets in the first quarter of 2026, which concerned, among other things, the ousting of the Venezuelan president, a military invasion of Iran, and details of the State of the Union address. While platforms like Kalshi and Polymarket are trying to take action against insider trading through improved protocols, the burden of monitoring currently still lies primarily with the operators themselves and not with the state supervisory authorities.

The political component is particularly explosive. Polymarket and Kalshi have links to the Trump environment, as Donald Trump Jr. serves as an advisor to both platforms. At the same time, the market is growing rapidly. Analysts from Eilers & Krejcik estimate that prediction markets could generate more than $1 trillion annually by 2030. This enormous sum not only attracts honest speculators but also massively increases the incentive for illegal information gathering.

Why it matters for German players

For German users, the legal situation is clear. Prediction markets like Polymarket or Kalshi do not have a license from the Joint Gambling Authority of the Federal States (GGL). This means that participation in such bets is illegal in Germany. The State Treaty on Gambling 2021 (GlüStV 2021) sets strict limits to protect players and prevent crime. This includes the monthly deposit limit of 1,000 euros via the LUGAS system as well as the stake limit of 1 euro per game on virtual slot machines. Platforms based on blockchain technology that do not perform identity verification according to German law offer no legal certainty.

Anyone who operates in unregulated markets risks not only losing their money without legal recourse but may also be liable to prosecution. In contrast to the insider scandals observed in the USA, German regulation through the GGL whitelist offers a safe framework. Here, providers are strictly tested for integrity and fairness. Insider trading, as observed with the Orcas on Polymarket, is to be made almost impossible by central monitoring in Germany.

What it means for GGL-licensed casinos

Licensed German providers must clearly distance themselves from such shadow markets. The current incidents in the USA show why strict regulation and the identification of every single player (KYC) are so important. For GGL casinos, this means a confirmation of their business model: security and transparency are the most important selling points compared to illegal crypto platforms. The authorities will probably further tighten the monitoring of foreign offers to prevent funds from Germany from flowing into such dubious channels, which could even endanger global security interests.