A wave of perfectly timed bets placed just before the removal of Nicolás Maduro from power in Venezuela has ignited the loudest fight yet over insider trading on prediction markets. Lawmakers are questioning how traders could place massive wagers seconds before real-world events without inside access. This controversy unfolds as prediction platform Polymarket achieves a major mainstream milestone with its integration into the 83rd Golden Globes broadcast.
The insider trading debate centers on a tool called Insider Finder, created by former meme coin trader Tre Upshaw. The software runs inside his Polysights data terminal and scans Polymarket for large, unusual trades tied to prediction contracts, flagging dozens of suspicious moves daily that appear before headlines break. In traditional stock markets, such behavior would likely bring criminal charges, but prediction markets operate in a regulatory gray zone.
The Commodity Futures Trading Commission (CFTC) oversees these platforms in the U.S. but has taken a light approach, saying little about insider trading and launching no enforcement wave. Few expect stricter oversight under the current Donald Trump administration, which has avoided tighter financial regulation. Notably, Donald Trump Jr. advises Polymarket and is a partner at 1789 Capital, a venture firm backing the platform.
Supporters argue prediction markets work better because insiders participate, risking real money and sharpening signals—as seen when Venezuela contracts moved before the news broke. However, pressure is building. Representative Ritchie Torres of New York recently pushed a bill that would block federal officials from trading prediction contracts tied to policy if they hold or could access confidential information. The bill gained co-sponsors quickly.
Polymarket's blockchain-based transparency is a double-edged sword. Every trade is written to a public blockchain, allowing tools like Insider Finder to be built without permission because the data is open and visible forever. Rival platform Kalshi works differently; it does not run fully on blockchain and does not show account-level records publicly. A Kalshi spokesperson said the platform verifies user identities, flags risky behavior, and sends all trades to the CFTC. CEO Tarek Mansour stated after the Venezuela activity that the platform bans manipulation because "it makes the game unfair."
Polymarket sits in a legal gray zone even after receiving funding from Intercontinental Exchange. Its main exchange operates outside the United States, and U.S. residents remain banned. Consequently, Polymarket does not run identity checks, leaving a regulatory loophole open.
Amid this debate, Polymarket celebrated a significant mainstream integration. During the three-hour Golden Globes broadcast on CBS and Paramount+, hosts occasionally checked Polymarket odds as traders bet on category winners. Polymarket CEO Shayne Coplan trumpeted the milestone on X, calling it "the single most mainstream prediction market integration to date" and noting that "Polymarket called 26/28 winners right."
Polymarket, founded by Coplan in 2020 and built on Ethereum scaling solution Polygon, is now valued at around $9 billion, just behind market leader Kalshi. Both platforms saw explosive growth heading into the November 2024 U.S. presidential election. In December alone, they recorded nearly $9 billion in combined trading volume.
Media partnerships are accelerating adoption. Polymarket is the exclusive prediction market partner for Yahoo Finance and recently agreed to provide exclusive data to The Wall Street Journal and other Dow Jones properties. Google Finance will offer data from both Polymarket and Kalshi in search results, while Kalshi is CNN's official partner, integrating its data into programming.
Coplan acknowledged the ongoing need to educate the public on market-based forecasts but emphasized their accuracy, stating, "People have more clarity about the world because Polymarket exists."
