A Prediction Market User Made $Nearly Half a Million from Wagers Predicting Maduro's Downfall.
An individual profited close to $500,000 on the ouster of the Venezuelan leader just before it was made public, leading to inquiries about potential gains made from inside knowledge of the US operation.
Changing Odds in Forecasts
Wagers on Polymarket, a blockchain-based service, that Nicolás Maduro would be out of power by the end of January rose in the time leading up to Donald Trump stated on the weekend that the Venezuelan leader had been taken into custody.
One account, which joined the platform in December and took four positions, all on political events in Venezuela, profited a total of $nearly half a million from a starting bet of $32,537.
Who placed the bet is a mystery. The anonymous account had only a string of letters and numbers for identification.
Probability Spikes Before Public Statement
Trading information shows that users estimated the likelihood of a political change at just under 7% in the midday period of the prior Friday.
But the market's assessment had climbed to over 10% by the end of the day and surged in the first hours of Saturday, indicating a sharp shift in market sentiment immediately prior to the official statement was made.
"This specific wager has all the signs of a trade based on non-public details," commented an industry expert.
A small number of other traders also earned significant sums from bets on the same outcome.
Legal Questions Grows
Some lawmakers are beginning to pay attention.
A new rule presented on recently would prevent federal workers from participating on prediction markets if they have "insider details" related to a wager.
Industry Context
Event-driven betting sites have grown significantly in the United States, with traders able to predict everything from sports to politics.
The industry faced scrutiny under the previous administration. However it has experienced less resistance during the present political climate.
Insider trading is against the law in the stock market, but there are fewer regulations in the event betting arena.
A company executive for another major platform said their site "explicitly prohibits such activities of any form."
