TLDR
- Senator Chris Murphy plans to introduce a bill banning prediction market trading on government actions like military strikes.
- Blockchain data showed six wallets made a combined $989,191 profit betting on the US Iran strike hours before it happened.
- The largest single wallet turned $60,816 into $494,375 profit by buying shares at 10.8 cents each.
- A House companion bill is being prepared by Rep. Mike Levin; similar insider trading cases have occurred on Polymarket before.
- Kalshi and Polymarket recorded a combined $18.3 billion in trading volume in February 2026.
Senator Chris Murphy said Wednesday he will introduce legislation this month to ban trading on prediction markets tied to government actions, including military strikes.
The move follows blockchain data showing six wallets made nearly $1 million betting on a US strike on Iran — hours before it happened.
The Polymarket contract was titled “US strikes Iran by Feb. 28, 2026?” The six wallets bought “yes” shares on Friday, the day before the US and Israeli airstrikes began on Saturday.
Blockchain analytics firm Bubblemaps identified the cluster of wallets. All six were newly funded and acted in a narrow window before the attack became public knowledge.
The largest wallet converted a $60,816 bet into $494,375 in profit. It purchased 560,680 “yes” shares at 10.8 cents each.
A second wallet under the name “Planktonbets” earned $173,907 across seven prediction markets. A third wallet, “Dicedicedice,” made $119,964 on a single bet placed at 20 cents — a 400% return.
Murphy said the pattern pointed to people with advance access to White House information. He called it a corruption risk.
“It looks like those six big accounts that were set up on Friday made a profit of a million dollars off of us going to war on Saturday,” Murphy said in a video posted to his official X account.
He added that allowing war betting could push people inside decision-making circles to favor conflict for financial gain.
Proposed Bill Details
Murphy’s bill would ban trading on events like military strikes and politicians’ speeches. It would not apply to financial markets, including Federal Reserve decisions like bond trading.
California Representative Mike Levin said he is preparing a companion bill in the House. Levin separately pointed to a Polymarket account called “Magamyman” that made roughly $515,000 in a single day on the Iran strike. That trader placed their first bet 71 minutes before news of the operation went public, entering when the market showed only a 17% probability of a strike.
Pattern of Alleged Insider Trades on Prediction Markets
This is not the first time suspicious timing has emerged on Polymarket.
In January, a new account wagered $32,000 on the removal of Venezuelan President Nicolás Maduro shortly before developments became public. That trader bought shares at around 7 cents and made over $400,000 within 24 hours.
In Israel, prosecutors indicted an Israeli Defense Forces reservist and a civilian earlier this month. They are accused of using classified military intelligence to bet on the timing of Israel’s strike on Iran during the June 2025 Twelve-Day War. The pair allegedly earned over $150,000 combined. They face charges including severe security offenses, bribery, and obstruction of justice.
Despite the scrutiny, prediction market volumes keep rising. Kalshi recorded $10.4 billion in trading volume in February. Polymarket logged $7.9 billion. Combined, the two platforms handled roughly $18.3 billion in a single month.
