Iran strikes sparked a betting stampede, $529 million hit Polymarket and Kalshi

Analytics firms flag suspicious accounts as Polymarket and Kalshi see heavy volumes tied to US military action against Iran.

• Over $529 million traded on Polymarket over US-Iran strike bets
• Six accounts made $1 million profit betting on exact strike date
• Regulators investigate insider trading on prediction markets

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More than $529 million was traded on Polymarket in contracts tied to the United States’ strikes on Iran this weekend, according to a Bloomberg report, as prediction markets saw a surge in geopolitical betting activity around the attacks.

By February 28, the day of the strike, the largest contract on Polymarket had drawn about $90 million in trading volume since its creation, Bloomberg reported. The second-largest contract tied to a US attack on Iran was dated January 31 and attracted $42 million in bets.

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Rival platform Kalshi saw $36 million in betting volume around a question related to a potential regime shift in Iran, according to a Washington Post reporter cited in the Bloomberg report.

The spike in trading has intensified scrutiny over insider activity on largely unregulated prediction platforms.

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Analytics firm Bubblemaps SA found that six accounts generated around $1 million in profits by betting on the exact date of the US attack — February 28, a Saturday, Bloomberg reported. According to Bubblemaps, the accounts were newly created in February and placed bets only on likely dates of potential US strikes, with some predictions made hours before the bombs fell in Tehran.

One contract dated February 27 attracted over $25 million in volume. A $26,513 wager placed on the February 28 contract, the largest bet ever made by that account, resulted in more than $1,74,000 in profit for its owner, Bloomberg said.

Polymarket did not immediately respond to queries on Saturday, according to the report.

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Nicolas Vaiman, CEO of Bubblemaps, told Bloomberg that prediction markets are among the first financial products allowing direct bets on geopolitical events. He said that conflicts and wars, combined with user anonymity, create “incentives for informed participants to act early.”

Users require only a digital wallet to trade on Polymarket.

New contracts open as strikes continue

Even as military operations in the Middle East continue, new contracts have opened on Polymarket asking whether a Gulf state will attack Iran this week or whether the US will strike Iraq by March, Bloomberg reported.

The report noted that similar patterns of concentrated bets and profits were observed during US strikes in Venezuela earlier this year, when Venezuelan President Nicolás Maduro was captured in January.

Betting on leadership change and death

Analytics company Polysights in January reported a surge in bets tied to the possible deposition of Iranian Supreme Leader Ali Khamenei by the end of March, according to Bloomberg. The firm estimated that the market priced the likelihood of his overthrow at 40%, and said 90% of alleged insider-linked accounts supported that contract.

Some contracts included speculation on Khamenei’s death, which critics argued could create incentives around violent outcomes. At the time of writing, local reports confirmed that Khamenei was killed in US strikes on Iran.

Kalshi Inc., a Commodity Futures Trading Commission (CFTC)-regulated rival of Polymarket, told Bloomberg on Saturday that it does not offer markets that settle on death. In the event of Khamenei’s death, Kalshi said it would resolve its contract based on the last price offered.

Polymarket operates outside the United States and beyond CFTC oversight. The platform has previously defended its contracts as a form of crowdsourced information, particularly in fast-moving situations where conventional reporting may lag, Bloomberg reported.

Regulatory backdrop and enforcement actions

The insider trading debate has drawn regulatory attention in recent months.

In February, Israeli authorities filed charges against a military reservist and a civilian for allegedly making $1,50,000 by using secret operational information to place Polymarket bets on Israeli security operations in 2025, Bloomberg reported. The case marked the first criminal charges tied to prediction-market bets made using classified intelligence, the report said.

Separately, Kalshi disclosed actions against two customers suspected of using insider information when placing bets, according to Axios. Those included an editor associated with MrBeast who allegedly used knowledge of unaired YouTube content, and a California gubernatorial candidate.