Suspicious Trades in Prediction Markets Hit $200M in H1 2026, Driven by Geopolitical Bets

According to Bloomberg Businessweek, suspicious trades flagged in crypto prediction markets including Kalshi and Polymarket totaled approximately $200 million in the first half of 2026, based on analysis of about 34,000 flagged transactions by Polysights. Geopolitical and war-related bets were the primary driver, with Iran-related wagers peaking in late February. The flagged trades showed highly concentrated profits: the top 1% of profitable wallets captured over half of all gains, and 57% of these wallets were created within 24 hours before trading. Seventy-one percent of flagged transactions were funded through U.S.-regulated crypto exchanges.

Multiple cases have triggered investigations, including a U.S. soldier accused of using military secrets to profit over $400,000 on Polymarket, and Israeli reserve forces personnel charged with wagering on Iran events using classified intelligence. Goldman Sachs has banned employees from trading prediction markets, and the U.S. Senate has prohibited members and staff from participating.