Polymarket Maduro’s bet resulting in $400,000 withdrawal sparks concerns over insider trading

Concerns over insider trading are mounting after a Polymarket bet on Venezuelan President Nicolas Maduro resulted in a $400,000 withdrawal.

As the investor and podcaster pointed out Joe Pompliano on XA brand new Polymarket account invested more than $30,000 on January 2 in a bet that Maduro would leave power in Venezuela by January 31, 2026. Shortly after, the United States arrested him that same evening, meaning the trader made more than $400,000 in less than 24 hours.

“Insider trading is not only permitted in prediction markets; they are encouraged,” Pompliano wrote.

A newly created Polymarket account invested over $30,000 yesterday in Maduro’s departure. The United States then arrested Maduro overnight, and the trader made $400,000 in less than 24 hours. Insider trading is not only permitted in prediction markets; it’s encouraged. https://t.co/EtZyW1IWTa pic.twitter.com/MzsU9kOU73

– Joe Pompliano (@JoePompliano) January 3, 2026

Although there is no evidence that the anonymous account is connected to anyone with inside information Regarding the planned movement of US forces, this raises concerns about the lack of restrictions on insider trading in prediction markets. This legal loophole may soon be closed, with New York Congressman Ritchie Torres introducing the Public Integrity in Financial Forecasting Markets Act of 2026, as reported by Jake Sherman of Punch Bowl News.

A legal void that requires regulation

This bill seeks to prevent federal elected officials, political appointees, and executive branch employees from participating in certain prediction market transactions that involve betting when they possess inside information relevant to the outcome or could reasonably obtain such information in the course of their official duties. The restriction would apply to the purchase, sale or exchange of predictive market contracts related to government policy, government action or political results.

We have already seen examples of how prediction markets could be abused when it comes to people in positions of power or with inside information, albeit on a smaller scale, when Coinbase CEO Brian Armstrong showed how business leaders could actually profit from contracts on their shares. Naturally, this potential becomes even more concerning when the issues concern global politics rather than trade outcomes.

ReadWrite has contacted Polymarket for comment.

Featured Image: Flickrlicensed CC BY-NC 2.0

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