WASHINGTON, D.C. — Polymarket announced new rules stating that users cannot act on insider information or trade on events whose outcome they could influence. The Commodity Futures Trading Commission issued guidance reminding prediction market platforms of their responsibilities to limit insider trading.

Analytics firm Bubblemaps reported that a series of connected Polymarket accounts earned $1 million over the past two years predicting U.S. and Israeli strikes in the Middle East. Approximately $529 million was traded on Polymarket tied to the timing of American and Israeli strikes on Iran.

Suspect bets have been largely concentrated on Polymarket. Many suspect bets on Polymarket were placed by accounts that were either new or solely focused on one specific outcome.

In February, Israel charged two military service members with using classified information to place bets on Polymarket related to unspecified combat operations. In January, a Polymarket user earned about $400,000 by betting that Venezuelan President Nicolás Maduro would soon be out of office. A Polymarket trader made approximately $1.2 million by forecasting whom Google would announce as the most-searched person of 2025.

"There's this false media narrative that CFTC-regulated markets are the Wild West and have no regulation and that's blatantly false," said Michael Selig, CFTC Chairman, in an interview with the Washington Reporter. "The CFTC uses complex surveillance tools and has seasoned career staff that pro-actively monitor these markets for insider trading and fraud," Selig added.

The CFTC made cuts in its enforcement division, including eliminating all enforcement attorneys in its Chicago office. Noah Solowiejczyk, a partner at the law firm Fenwick & West and a former federal prosecutor, said that the CFTC has likely been hampered by staffing shortages, which may be impacting its ability to take on new cases.

"I think you'll see an enforcement action or prosecution happen in an events-driven insider trading case," said Solowiejczyk. No American has faced federal charges related to insider trading on event-driven news.

Polymarket is a platform that allows users to wager on the likelihood of certain events taking place. Part of Polymarket is registered in the U.S., making it subject to federal know-your-customer requirements. Another part of Polymarket is registered in Panama. Polymarket began accepting trades from U.S.-based users after the Trump administration ended a Biden-era effort to restrict its use in the U.S.