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A bettor profited close to $500,000 by predicting the removal of the Venezuelan leader immediately preceding it was publicly declared, leading to inquiries about the possibility of profiting from confidential information of the event.

Sudden Shift in Forecasts

Predictions made on the forecasting site, an online prediction market, that Nicolás Maduro would be no longer in control by the end of January increased in the hours before President Donald Trump declared on Saturday that the Venezuelan leader had been taken into custody.

A particular user, which became a member recently and took four positions, all on Venezuela, earned over $436,000 from a initial bet of over $32,000.

Who placed the bet is a mystery. This unidentified trader had only a blockchain identifier for identification.

Odds Fluctuate Before Announcement

Platform data shows that traders assessed the probability of the president's removal at just under 7% in the midday period of Friday, January 2nd.

However the market's assessment had jumped to 11% by late Friday night and skyrocketed in the morning of Saturday, indicating a sharp shift in market sentiment just before the official statement was made.

"This particular bet has all the hallmarks of a bet based on non-public details," commented a financial reform advocate.

Several of other platform users also profited tens of thousands of dollars from similar wagers.

Regulatory Scrutiny Grows

Some lawmakers are beginning to pay attention.

A new rule put forward on recently seeks to ban public officials from participating on forecasting platforms if they have "confidential government knowledge" related to a bet.

The Prediction Market Landscape

Forecasting platforms have surged in popularity in the United States, with participants able to bet on everything from elections to current affairs.

Prediction markets were examined under the Biden administration. But it has experienced less resistance during the present political climate.

Insider trading is against the law in the securities markets, but there are fewer regulations in the prediction market space.

A company executive for another major platform said their site "strictly forbids trading on insider information of any form."