Polymarket insider trading risk: military bets show abnormal longshot wins

A new Anti-Corruption Data Collective (ACDC) study flags potential Polymarket insider trading in military and defense markets. After analyzing 435,000+ settled Polymarket contracts (Jan 2021 to mid-March 2026) and $54.4B cumulative volume, the report finds that longshot bets in military-linked outcomes win 51.8% of the time versus a 14% political-market baseline. The authors argue this pattern is hard to explain by skill or luck and points to information asymmetry, where a small group may have non-public or specialized knowledge. The findings align with earlier research on Polymarket’s concentrated influence: about 3% of traders drive most price discovery, and fewer than 1% of wallets capture around half of profits. As a case study, ACDC examines the June 2025 U.S. strike on Iran. Hours before the outcome, 19 longshot bets totaling $164,292 were placed across contracts that later resolved YES; eight wallets shared about $1.8M in profits, with one taking nearly $500,000. ACDC recommends stronger bettor identity verification, conditional payouts for suspicious wagers, limits on markets dominated by small groups, and restrictions on overly granular contracts. Polymarket says it uses surveillance teams and cooperates with the DOJ, and it prohibits trading on confidential knowledge, similar to Kalshi. Overall, this Polymarket insider trading debate could increase scrutiny and reduce confidence in prediction-market price signals—especially for defense-related themes.