‘An intelligence and information-warfare tool’: Bubblemaps’ chief on prediction markets

Bubblemaps flags uncanny Iran-war bets on Polymarket; insiders may be gaming prediction markets.

Bubblemaps identified on Polymarket 80 wagers on U.S. military action against Iran with such precision that “one stroke of luck does not explain it.” Nicolas Waisman, CEO of the analytics platform, told CoinDesk that if unusual trades are visible to outside observers, America’s adversaries can track them too.

“To speak plainly — this can put many people’s lives at risk,” he said.

He said wagers on military operations have topped $1bn this year amid geopolitical tension. That is creating a new kind of insider trading.

Large bets were placed days ahead of the February 28 strikes on Iran, the elimination of the country’s supreme leader, and the announcement of a ceasefire. Nine accounts on Polymarket earned more than $2.4m almost exclusively from wagers on U.S. military operations.

“They bet not only on strikes days before they were carried out, but also on later dates to maximize profit,” Waisman noted.

To avoid drawing attention, these accounts also placed small losing bets on February 20. Their accuracy reached 98%. Waisman added that during the strikes on Iran, civilians checked Polymarket to decide whether to spend the night in bunkers.

Asked directly about a link between the insiders and the U.S. government, Waisman replied:

“We have no evidence that they are military or Americans at all. The data are suspicious and point to someone with an unfair information advantage.”

Congressman Mike Levin wrote on X that “the insider trading problem on prediction markets is bigger than any of us could have known.” Together with Senator Adam Schiff, he introduced the DEATH BETS Act to ban war-related contracts.

The insider trading problem with prediction markets is bigger than any of us could have known.

The New York Times found 80+ Polymarket accounts showing signs of insider trading, many tied to U.S. military operations, including seven that collectively won $1.4 million on the…

— Rep. Mike Levin (@RepMikeLevin) May 15, 2026

Waisman also suggested prediction markets could be used for manipulation:

“The government can deliberately place bets to create a false signal and mislead adversaries. Prediction markets are an intelligence and information-warfare tool.”

He added that such platforms not only forecast the future but also change it. At the same time, he stopped short of blaming the platform itself:

“I do not want to attack Polymarket. Anyone can use a cheap VPN or buy an account that has passed KYC. This is not a problem of Polymarket alone, but of the entire internet.”

400 suspicious trades

Since the start of the year, Kalshi has reviewed and flagged more than 400 suspicious trades — twice as many as in all of last year, Reuters reports, citing its own sources. Some were passed to the U.S. Commodity Futures Trading Commission (CFTC). On Polymarket, the volume of anomalous contracts has also risen markedly.

“In the world of classic insider trading it is usually not hard to determine who has access to non-public information. In prediction markets, assembling such data is often impossible,” said Stanford Law School professor and former SEC commissioner Joseph Grundfest.

Turnover keeps climbing: Kalshi’s trading volume over half a year has more than tripled to $178bn. At Polymarket, the monthly notional volume of the offshore and U.S. venues in April was about $10.3bn, up from $3.8bn a year earlier.

In parallel, platforms are tightening their rules. They recently barred federal employees from betting on political campaigns in which they are involved. Regulation of prediction markets has become a tussle between the CFTC, which wants to police them as derivatives, and individual states.

Investor interest has lifted valuations: Kalshi closed a $1bn round at a $22bn valuation. Polymarket is in talks for new funding at a $15bn valuation.

Earlier, CFTC chair Michael Selig said the regulator would crack down on insider trading. In response, Kalshi and Polymarket updated their rules and explicitly banned wagers based on confidential information and illegal tips. Polymarket also removed some war-related contracts.

“If a person has inside information, he is more likely to use it on a prediction market than on the stock market,” said University of Toronto business-school professor Charles Martino.

Investors are increasingly checking prediction markets before making trades. Such venues sometimes forecast election outcomes and economic decisions more accurately than traditional polls.

Users buy and sell binary yes-or-no contracts on the outcomes of events — from economic policy to sport.

“These markets allow you to trade not on the market’s reaction to a piece of news, but on the news itself. The risk is lower,” explained HEC Montreal business-school professor Vincent Grégoire.

In April, the U.S. Department of Justice charged active-duty service member Gannon Kane Van Dyke, who is suspected of using classified information to place bets on Polymarket.