“National Security” Can’t Exist in a World with Prediction Markets

Yesterday afternoon, as I worked on a story about several unknown bettors who are suspected of breaking into France’s Charles de Gaulle Airport in order to tamper with temperature recording instruments so they could win their Polymarket bets on the daily high temperature reading in Paris, I thought to myself “Well, this will probably be the worst headline related to prediction markets I’ll see for the next week.” But as it turns out: No, that wasn’t accurate in the least. It took only a few hours, in fact, before a far worse Polymarket headline reared its head and eclipsed it: A U.S. soldier arrested by federal agents for allegedly making more than $400,000 betting on prediction markets about the removal of Venezuelan President Nicolás Maduro from office, using classified information about the U.S. plan of attack to do so. It’s exactly the sort of high-level reveal of insider trading corruption involving prediction markets that we’ve known for some time now must be about to arrive.

In this case specifically, the soldier in question, Gannon Ken Van Dyke, wasn’t some basic enlisted grunt, either. He was a special operations team member, a guy manning a post that is meant to be “elite forces,” the best of the best and most disciplined that the U.S. Army has to offer. He was part of an operation requiring the utmost secrecy, and had no doubt received some of the most rigorous training the Army has to offer on things like protecting OPSEC. And this guy still chose to leverage his knowledge of what was about to happen in Venezuela to attempt to personally profit, betting more than $33,000 on Polymarket in the hours before the raid that would capture Maduro. It speaks to a glaring truth that no country can now afford to ignore: The temptation to abuse privileged information via prediction markets is far too strong for governments to expect bad actors to resist it. The rewards are too big, and too easily accessed. We have built a perfect engine of corruption, with the President of the United States leading the way and cheering on the development of an industry that inherently undermines any notion of national security or classified information being possible. We’ve made treason into a game.

Criminal indictment alleging Gannon Ken Van Dyke made more than $400,000 trading on Polymarket using classified information concerning the capture Nicolás Maduro

www.justice.gov/usao-sdny/me…

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— Jen Taub (@jentaub.bsky.social) Apr 23, 2026 at 7:38 PM

Rest assured, Van Dyke knew precisely what he was doing, and how big of a problem it was for him to be doing it. The unusual nature of the anonymous bets he allegedly made were quickly noticed by users and widely reported, and he quickly leapt into action in an attempt to hide the evidence, deleting his Polymarket account and funneling the funds into harder to access cryptocurrency wallets. He has since been indicted by the DOJ on charges that include the unlawful use of confidential information for personal gain, commodities fraud, wire fraud and theft of nonpublic government information. As the indictment puts it: “Rather than safeguard that information as he was obligated to do, Van Dyke decided to use that classified information to place trades on a prediction market platform for his personal profit. Van Dyke subsequently tried to conceal his unlawful use of classified U.S. Government information by attempting to obscure the source of his unlawful proceeds and to disguise his connection to the accounts linked to the illicit trades.”

This is an egregious breach of protocol, operational security, and military intelligence, and it’s undeniably a good thing that the DOJ and FBI were able to follow the breadcrumbs in conjunction with Polymarket to bring this particular case of abuse to light, where it will no doubt receive the most intensely public punishment possible as an attempted deterrent. But it’s only logical to assume that a case such as this one is the most glancing tip of a massive iceberg of fraud and insider trading, most of which may not be so glaringly obvious as a person betting on the removal of Maduro hours before it happens. How many other members of the U.S. military are more subtly using classified information and mission data to place bets in more obscure corners of the major prediction markets? How many politicians are profiting in this way, or are crafting legislation specifically to create more opportunities to do so?

Even the MAGA bots of Twitter are shaken–look at FBI Director Kash Patel (who recently had the Bureau investigate the reporter who dared to write about his girlfriend), who attempted to trumpet the FBI’s prowess in taking Van Dyke down on Twitter, only to be met by outraged blue check MAGA boosters who decried that “you will arrest a brave soldier for this, but do nothing about Congress who does the exact same thing everyday.” When even the delusional bootlicks can see the problem, it has truly become universal.

Take your pick as to the other recent headlines that have already demonstrated the depth of this problem. Kalshi, for instance, recently suspended three political candidates who had been betting on their own races, including one U.S. Senate candidate, Virginia’s Mark Moran, who later claimed that he intentionally wanted to be exposed to make a point about how prediction markets were “dangerous to our democracy.” Or of course you can look at the buildup to the Iran War, in which vast amounts of money flooded prediction markets in the hours before U.S. missiles and bombs began to rain down on the Middle Eastern country, presumably fronted by any number of those with inside information on U.S. military movements. More than 150 different accounts placed bets of at least $1,000 in the 24 hours before the first U.S. attack, correctly saying that the war would kick off the next day. The surge in bets compared to the day before was comically large.

Kalshi has sanctioned three political candidates for trying to make trades on their own races.

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— The New York Times (@nytimes.com) Apr 22, 2026 at 10:30 PM

So, how many of those account holders have been identified and arrested by the DOJ to date? How many ever will be? The case of Gannon Ken Van Dyke and the Venezuela raid stands out for the big dollar total involved, but do we have the same conviction to go after the scores of accounts engaged in similar behavior that aren’t getting quite as many headlines? What about those who are using similarly privileged information to bet on prediction markets that aren’t tied to something as dire and headline-grabbing as the outbreak of a new war? Are we looking into government officials who have access to crop reports? Traffic data? When you can bet on anything, nearly any piece of non-public information suddenly has a brand new monetary value.

That’s the biggest single issue: Prediction markets have commodified every type of data and incentivized it to be used in unethical ways. The CEO of Kalshi once said that he wanted to monetize “any difference in opinion,” but instead they’ve managed to monetize anyone who has access to non-public information, and removed the hurdles of difficulty/lowered the bar on betrayal to capitalize on that information. Consider Gannon Ken Van Dyke again: A decade ago, could he have profited from knowledge of when the U.S. attack on Venezuela would occur? Maybe, but it would have required him to … contact the Maduro regime and negotiate a price to betray his fellow soldiers with some capital T treason? Who would have had the conviction to go through with that? But in 2026, it’s as simple as just placing a quick bet on your phone in the hours before the operation kicks off, with hundreds of thousands of dollars on the line. Can you even imagine how much easier that is for the average person to rationalize that it is both worth the risk and morally defensible? When you make crime this profoundly easy, you can’t expect people to simply elect not to participate.

Nor can you expect the President of the United Fucking States to abstain from participation, either. Instead, the Trump administration has done everything it possibly can to throw its weight behind prediction markets like Kalshi and Polymarket, with the recently appointed chairman of the Commodity Futures Trading Commission, Michael Selig, writing that the federal government will step in to prevent states (the party of states’ rights!) from regulating or banning prediction market platforms, as the likes of Arizona are trying to do. In The Wall Street Journal, Selig shared that the administration would side with prediction market companies over state sovereignty in all cases, saying: “The CFTC will no longer sit idly by while overzealous state governments undermine the agency’s exclusive jurisdiction over these markets by seeking to establish statewide prohibitions on these exciting products.”

Unsurprisingly, this stance from the CFTC, which is ostensibly supposed to regulate prediction markets, goes hand in hand with both members of Trump’s immediate family and the man himself profiting mightily off their involvement in the industry. In particular, eldest son Donald Trump Jr. is a major investor in Polymarket, holding a large stake in the platform through a venture capital fund as its valuation has surged to almost $10 billion. Simultaneously, Trump Jr. is also a paid advisor for Kalshi as well, because why the fuck not? President Donald Trump, meanwhile, is planning on getting his fingers directly into the prediction market industry via the establishment of his very own market owned by The Trump Organization, reportedly to be titled Truth Predict. Hey guys, remember when we used to require that Presidents divested themselves of businesses they would stand to profit from when taking office? Why did we do that, again?

The sheer, naked corruption of all this really can’t be overstated: The President of the United States is planning on opening his very own prediction market, which will allow users to bet on current events that members of that same administration will have direct power to influence or determine. Insider trading, I would presume, will be “not allowed” for users in the official terms of service, assuming that any of The Trump Organization’s lawyers get around to remembering to stick that line in there for appearances.

Because I can only imagine you’re feeling like there hasn’t yet been enough hypocrisy inherent to this story, please enjoy the following. On Thursday, following the news breaking about the arrest of Van Dyke and the wagers he had made with classified information, putting an entire U.S. military campaign in jeopardy in the process, Donald Trump was asked by reporters in the Oval Office to comment on the situation. He proceeded to make light of Van Dyke’s wagers, comparing it to “Pete Rose betting on his own team,” as if it would only be a problem if this special operations soldier was intentionally trying to get his comrades killed. At the same time, he’s entirely avoided the subject on Truth Social, despite having posted about three dozen times in the last 24 hours.

Q: “People suspect that there’s insider trading happening on these prediction markets around the war. Are you concerned?”

Trump: “The whole world, unfortunately, has become somewhat of a casino.”

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— The Bulwark (@thebulwark.com) Apr 23, 2026 at 7:39 PM

Pressed further about the threat of federal employees making insider trading bets with classified information on the Iran War and other conflicts, Trump then segued into the following: “The whole world, unfortunately, has become somewhat of a casino. You look at what’s going on all over the world, in Europe and every place, they’re doing these betting things. I was never much in favor of it. I don’t like it conceptually, but it is what it is. No, I think that I’m not happy with any of that stuff. But they have all these different sites. They have predictive markets. It’s a crazy world. It’s a much different world than it was.”

That’s what the President of the United States said about prediction markets, while his eldest son was deeply financially involved in guiding the two biggest of those markets in the United States, and his self-named company–that he refused to divest himself from like every other previous President in history–is in the process of opening their own new prediction market to further profit from the industry. But don’t worry, because Trump is in fact “not happy with any of that stuff,” and “never much in favor of it.” He’s merely just doing it anyway, and instructing the federal agency meant to regulate them to instead let prediction markets run wild and operate in defiance of the U.S. states that want to ban them. Imagine how much worse things could be if Donald Trump was “in favor” of these Treason Parlors. Now there’s a scary thought.

For what it’s worth, Kalsi now gives 71% odds that Trump will be impeached before his second term ends, which is a new all-time high. For that case, and that case only, I do hope that some of that money is coming from those with insider information.