A Prediction Market User Earned $Nearly Half a Million from Bets on the Ouster of Maduro.
A bettor profited close to $500,000 from wagers on the downfall of Venezuela's president immediately preceding it was publicly declared, leading to inquiries about whether someone profited from confidential information of the US operation.
Market Movement in Predictions
Bets placed on the crypto-platform, a blockchain-based service, that Nicolás Maduro would be removed from office by the close of the month surged in the time leading up to Donald Trump declared on Saturday that Maduro had been seized.
One account, which became a member in December and made four bets, all on political events in Venezuela, profited a total of $436K from a initial bet of over $32,000.
Who placed the bet is a mystery. The anonymous account had only a cryptographic address for identification.
Odds Fluctuate Before Announcement
Trading information shows that traders estimated the likelihood of the president's removal at just under 7% in the afternoon of the Friday before the event.
But the odds had jumped to over 10% by the end of the day and skyrocketed in the morning of the next day, indicating a sudden change in positions immediately prior to the public announcement was made.
"That trade has all the hallmarks of a trade based on non-public details," stated an industry expert.
A small number of other platform users also made large payouts from similar wagers.
Legal Questions Grows
Some lawmakers are starting to take note.
A bill presented on the start of the week aims to prohibit government employees from placing bets on forecasting platforms if they have "insider details" related to a bet.
The Prediction Market Landscape
Prediction markets have grown significantly in recent years, with traders able to predict everything from sports to political events.
This sector faced scrutiny under the last presidential term. However it has received a warmer welcome during the current presidency.
Using confidential knowledge is against the law in the stock market, but there are fewer regulations in the prediction market industry.
A spokesperson for a competing service said their site "has clear rules against insider trading of any form."
