The prediction market sector is facing fresh scrutiny after suspiciously-timed trades were made on the outcome of a USA-Iran ceasefire on several platforms.
More than $170 million was traded on Iran and USA agreeing to a ceasefire in the hours before the two nations found some common ground. On April 7, President Donald Trump posted on X saying the two nations had reached a “double-sided ceasefire”.
Group profited more than $600,000 from trades
Reports suggest the focus is on a cluster of traders that are believed to have inside knowledge of geopolitical movements. They earned more than $600,000 on Polymarket on Tuesday, capitalizing on contracts tied to a ceasefire between the United States and Iran, according to blockchain analytics firm Bubblemaps.
The same group also posted larger gains earlier this year, collecting about $1.2 million from bets linked to Israeli and U.S. strikes on Iran in late February, the firm said, citing a pattern of well-timed trades.
Speaking to Decrypt, a media outlet in the intersection of culture and technology, a representative from Bubblemaps believes the same group of people continue to cash in on specific events: “This cluster has been betting and winning on military markets since 2024 using multiple accounts, some recently created, some older.”
The Polymarket accounts, listed as “djijaij83jdo4jdlwjflsg,” “Elonfax89678,” and “Skoobidoobnj,”, were predicting a ceasefire before April 7 and April 15. The traders were not successful across all positions, however, losing nearly $50,000 on bets that a ceasefire would occur before March 31.
Bubblemaps pointed out that the large wagering amount does not necessarily mean any wrongdoing has occurred. In its analysis on X, it said: “We cannot say for certain that these accounts are insiders. Their win rate on ceasefires is not perfect, and some positions, such as March 31, did not play out. Still, their track record of correctly calling surprise attacks on Iran suggests they may have access to better information than most.”
Iran ceasefire bet latest in spate of war-driven trades
Earlier in the year, prediction markets came under heightened scrutiny after Kalshi and Polymarket accepted wagers tied to the so-called “Khomeini Out” market. More than $500 million was traded on the timing of the outcome, prompting lawmakers to call for an investigation into the practice.
Concerns deepened Bubblemaps said six suspected insiders made about $1.2 million betting on a U.S. strike on Iran. The firm flagged accounts that placed “yes” wagers hours before the attack, with analysts noting the wallets were newly created and funded shortly beforehand.
The episode added to mounting pressure on the sector, as state officials argued the platforms should be regulated like traditional betting operations. The scrutiny came as legal battles intensified, with a Massachusetts court temporarily blocking Kalshi from offering certain contracts without a state license and regulators in Nevada and Maryland moving to restrict or challenge the companies’ operations.
Arizona became the first state to file criminal indictments against a prediction market company last month, when Attorney General Kris Mayes hit Kalshi with 20 charges tied to what she called an illegal gambling operation. The company rejected the claims at the time, calling them “paper thin”.
New Jersey court rules in favor of prediction market
Meanwhile, a federal appeals court ruled Monday that New Jersey regulators cannot block Kalshi from offering sports-related prediction markets to users in the state. In a 2-1 decision, the U.S. Court of Appeals for the Third Circuit said the Commodity Futures Trading Commission (CFTC) has exclusive authority over the event contracts traded on the platform.
The decision marks the first time a federal appeals court has weighed in on the growing conflict between state gaming regulators and prediction market operators. U.S. Circuit Judge David Porter wrote: “Kalshi’s sports-related event contracts are swaps traded on a CFTC-licensed DCM, so the CFTC has exclusive jurisdiction.”
It is a welcome respite for prediction market companies like Kalshi, whose CEO Tarek Mansour celebrated the ruling on social media, calling it “a big win for the industry and millions of users”.
CFTC spokesperson Brooke Nethercott said the judgement reflects the political lay of the land at this time.. “Congress gave the CFTC exclusive jurisdiction over trades on DCMs, and this decision affirms the goals of Congress,” she added.
However, in dissent, U.S. Circuit Judge Jane Richards Roth sounded a word of caution over the business as it stands. She wrote that prediction market “offerings were virtually indistinguishable from the betting products available on online sportsbooks, such as DraftKings and FanDuel.”
