A Polymarket account netted over $400,000 from bets related to the United States' capture of Venezuela President Nicolas Maduro, causing an outcry among lawmakers, with one congress representative saying his proposed bill to ban insider trading needs to be introduced “as soon as possible.”
Key Takeaways
- A new bill from Representative Torres attempts to curb government officials' use of insider information to trade on prediction market platforms.
- The bill comes as a Polymarket account came under fire after placing bets on Nicolas Maduro's ouster hours before the U.S.’ operation in Venezuela.
- Kalshi asserted it does not allow insider trading on its platform.
Representative Ritchie Torres of New York is introducing a bill that would prohibit federal elected officials, political appointees, and executive branch employees from using prediction market platforms to trade on events related to government policy or political platforms if they possess or could obtain information on the outcome, according to Punchbowl News.
While the bill does not yet have co-sponsors, Torres hopes it will gain sponsorship in the coming weeks, and a spokesperson said the bill has been in development for some time, per The Block.
The proposal from Torres comes as a Polymarket user is being accused of insider trading.
The account, created at the end of December 2025, has only made four predictions, one of which was placing around $32,500 on whether Maduro would be “out” by Jan. 31. After purchasing shares at around 7 cents, the shares resolved at nearly $1 each, resulting in a profit of over $400,000, a 1,200% return, according to Axios.
Kalshi has since chimed in, stating it is against the platform's rule book for insiders to trade on nonpublic information.
Donald Trump Jr. also currently serves in an advisory role for both Kalshi and Polymarket, with his venture capital firm making a “strategic investment” in Polymarket last year.
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Think tank worker fired after edited map settles Polymarket contracts
As Polymarket faces scrutiny for alleged insider trading, a member of staff at a U.S.-based think tank was recently fired after editing a Ukraine war map used to resolve a Polymarket contract, which helped individuals profit.
To settle war-related contracts, Polymarket utilizes the Institute for the Study of War in Washington, D.C. It was found that a staff member purposely edited a map just before the market settled.
The map showed that Russia had taken control of a town in eastern Ukraine, Myrnohrad, despite no other evidence that forces had done so. Although the event was unlikely to unfold, users who had purchased contracts regarding the takeover made profits as high as 33,000% on their initial investment, with Polymarket having taken in $1.3 million in contracts.
The Institute for the Study of War released a statement regarding the edit, saying, “The unauthorized edit was removed before the day’s normal workflow began on November 16 and did not affect ISW mapping on that or any subsequent day. The edit did not form any part of the assessment of authorized map changes on that or any other day. We apologize to our readers and the users of our maps for this incident.”
