An Prediction Market Participant Earned $Nearly Half a Million on Bets on Maduro's Downfall.
A bettor profited close to $500,000 on the ouster of the Venezuelan leader immediately preceding it was made public, raising questions about the possibility of profiting from non-public details of the US operation.
Sudden Shift in Predictions
Predictions made on the forecasting site, an online prediction market, that the Venezuelan president would be out of power by the end of January increased in the hours before Donald Trump announced on the weekend that Maduro had been apprehended.
A single trader, which became a member last month and made four bets, all on Venezuela, made more than $nearly half a million from a modest 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 Public Statement
Platform data shows that participants put the odds of Maduro's exit at just 6.5% in the midday period of Friday, January 2nd.
But these probabilities had increased to 11% by late Friday night and skyrocketed in the first hours of Saturday, pointing to a sudden change in positions immediately prior to the social media post was made.
"This specific wager has all the hallmarks of a trade based on non-public details," said Dennis Kelleher.
A handful of other platform users also made significant sums from bets on the same outcome.
Legal Questions Grows
Some lawmakers are beginning to pay attention.
A bill introduced on the start of the week seeks to ban government employees from participating on prediction markets if they have "confidential government knowledge" related to a bet.
The Prediction Market Landscape
Event-driven betting sites have grown significantly in the United States, with participants able to wager on everything from elections to current affairs.
This sector encountered regulatory challenges under the previous administration. But it has experienced less resistance during the present political climate.
Using confidential knowledge is against the law in the traditional financial markets, but there are fewer regulations in the forecasting space.
A spokesperson for another major platform said their site "has clear rules against such activities of any form."
