An Forecasting Platform User Earned $436K from Wagers Predicting Maduro's Downfall.
An individual made nearly half a million dollars by predicting the removal of Nicolás Maduro shortly prior to it was publicly declared, sparking debate about whether someone profited from non-public details of the event.
Changing Odds in Wagers
Bets placed on the crypto-platform, a blockchain-based service, that Nicolás Maduro would be no longer in control by the end of January rose in the period preceding President Donald Trump announced on Saturday that Maduro had been taken into custody.
A single trader, which became a member recently and took four positions, all on Venezuela, profited a total of $nearly half a million from a initial bet of over $32,000.
The identity is unknown. This unidentified trader had only a cryptographic address for identification.
Odds Fluctuate Before Public Statement
Trading information shows that participants put the odds of the president's removal at just under 7% in the late afternoon of the prior Friday.
Yet the market's assessment had increased to eleven percent by late Friday night and spiked dramatically in the morning of Saturday, indicating a sharp shift in betting activity just before the social media post was made.
"This specific wager has all the hallmarks of a transaction based on inside information," said Dennis Kelleher.
A handful of other traders also made significant sums from bets on the same outcome.
Political Attention Grows
Elected officials are growing concerned.
Proposed legislation introduced on the start of the week seeks to ban government employees from participating on prediction markets if they have "insider details" related to a market.
Industry Context
Prediction markets have surged in popularity in the United States, with participants able to wager on everything from elections to political events.
The industry faced scrutiny under the previous administration. Yet it has received a warmer welcome during the present political climate.
Using confidential knowledge is against the law in the stock market, but there are less oversight in the prediction market arena.
A company executive for another major platform said their site "explicitly prohibits insider trading of any form."
