A Prediction Market User Made $Nearly Half a Million on Wagers on Venezuela's Political Shift.
An individual earned a substantial sum on the ouster of Nicolás Maduro immediately preceding it was made public, raising questions about whether someone profited from inside knowledge of the US operation.
Sudden Shift in Predictions
Predictions made on the forecasting site, a blockchain-based service, that Nicolás Maduro would be no longer in control by the month's conclusion increased in the time leading up to Donald Trump declared on January 3rd that the president had been apprehended.
One account, which became a member last month and made four bets, all on political events in Venezuela, made more than $nearly half a million from a modest bet of $32,537.
The identity is unknown. The anonymous account had only a string of letters and numbers for identification.
Probability Spikes Before Announcement
Trading information shows that users estimated the likelihood of Maduro's exit at just a low 6.5 percent in the midday period of Friday, January 2nd.
But the odds had increased to 11% by late Friday night and spiked dramatically in the first hours of January 3rd, indicating a rapid movement in positions just before the official statement was made.
"This specific wager has all the characteristics of a bet based on inside information," stated a financial reform advocate.
A handful of other platform users also profited tens of thousands of dollars from similar wagers.
Legal Questions Grows
Some lawmakers are growing concerned.
A new rule put forward on recently aims to prohibit public officials from making trades on prediction markets if they have "insider details" related to a wager.
Industry Context
Event-driven betting sites have grown significantly in the United States, with traders able to predict everything from sports to politics.
This sector faced scrutiny under the previous administration. But it has experienced less resistance during the Trump presidency.
Trading on insider information is a crime in the securities markets, but there are fewer regulations in the event betting arena.
A spokesperson for a competing service said their site "explicitly prohibits trading on insider information of any form."
