Opinion

The Maduro Polymarket bet is not “obviously insider trading”

​Published on January 4, 2026 10:53 AM GMTCrosspost from substackSo, if you haven’t heard the news, America deposed Maduro, and a fresh polymarket account bet on it happening and made ~$320k in profit.Seems suspicious right! And yeah! The media, expectedly, went hogwild.And look, I agree, I smell the same stench all of you do, but that doesn’t mean that this is not an “obvious case of insider trading”, as some twitterers, redditors, youtubers and even news outlets have claimed. Today I want to make the case that this is not an obvious conclusion!1Full story of the polymarket accountThe account bought shares in 3 prediction markets:2Maduro out by January 31 (bought at 7-11 cents)US forces in Venezuela by January 31Trump invokes war powers against Venezuela by January 31The first market was resolved to yes, since well, he’s out. This is where the majority of the profits were made.The others have not been resolved yet. Yet this person sold! If this person had perfect information, as has been suggested, it would be very irrational to sell these shares before the market resolves.Also, notice the rates at which he bought. It’s not like polymarket broadly believed this to be impossible at all. 10 cents means that the market thinks the odds of this happening are around 10%. You could explain this with even more insider trading. But maybe not! Maybe, in some ways, a lot of the signs were quite obvious.“Trump has repeatedly told the media that Maduro’s days in power are numbered.”The above quote is from december 31st.And if you think that this is so obviously insider trading and this person is obviously so sure, then why only bet 80k? I can’t really imagine a guy close enough to trump that he would have this amount of intel yet not have more than 80k in the bank to gamble with. And I don’t think the argument of “any more would be suspicious” really holds either here, betting $800k or $80k is about as suspicious, at the very least, the wins would outpace the odds of trouble.I think if what we were seeing was genuine insider trading, it would likely look a lot more like “buys shares at $0.01 way in advance for oddly specific date”, sells when market resolves. And as I said, that’s not what happened.Now, why is it a fresh account? I don’t know! But again, it’s not immediately obvious that “this is a fresh account” ∴ “covering up insider trading”. It could be someone making that trade that doesn’t want to be seen doing it publicly, for personal reasons. Or just someone using polymarket for the first time!Edges are naturally weirdAn “edge” is information in the market that your competitors don’t have access to, or haven’t discovered. This is what those people at jane street do all day. They find edges and exploit them.Anyone working in finance will tell you that getting an “edge” can be very bizzare stuff. Things like how shadows cast on oil barrows (I think), tracking the number of pizzas going to the white house, etc…It’s definitely possible that this person had some sort of edge, without it having been insider trading.An estimateNow, let me be a nerd for a minute alright, there’s a theorem for this! And in this specific case, we don’t have to vaguely allude to bayes theorem, we can actually run the numbers for once!3So, 4 suspicious things happened here at once! I’ll make conservative estimates for the probability of all of them.Someonebet a lot of money on a newsworthy event (let’s say, 50 yearly newsworthy events, with 10 big bets per event)on a fresh account (M) (p = 0.15, as I said, many reasons to do this on a fresh account )on a tightly timed bet (p = 0.15, a bit more suspicious, but not implausible given polymarket is relatively high frequency)and won a resolved market (p = 0.1, polymarket odds4)5So, even in a world with zero insider trading, how often would we expect to see something like this?In other words, even with zero insider trading, you should expect about one eerily perfect-looking trade per year.Not impossible!ConclusionsThere are many good arguments for this being merely a coincidence. Not every suspicious polymarket account is insider trading.That being said, do I think it was insider trading? I mean, probably, the trump administration has shown that they care way less about this sort of behavior. But on the whole, I’m not dismissing the null hypothesis here. Nothing ever happens.1This post could have been way longer, feel free to add nuance in comments, but I have exams right now, so I mustn’t get nerdsniped2much more detective work to be done here, feel free3using bayes with a prior for insider trading is probably better, but I cba today, as I said, exams.4imperfect if there was actual insider trading, but polymarket is just very good otherwise, so hard to decide probability in a different way.5Notice how he didn’t outright win the other 2 markets by the way!Discuss ​Read More

​Published on January 4, 2026 10:53 AM GMTCrosspost from substackSo, if you haven’t heard the news, America deposed Maduro, and a fresh polymarket account bet on it happening and made ~$320k in profit.Seems suspicious right! And yeah! The media, expectedly, went hogwild.And look, I agree, I smell the same stench all of you do, but that doesn’t mean that this is not an “obvious case of insider trading”, as some twitterers, redditors, youtubers and even news outlets have claimed. Today I want to make the case that this is not an obvious conclusion!1Full story of the polymarket accountThe account bought shares in 3 prediction markets:2Maduro out by January 31 (bought at 7-11 cents)US forces in Venezuela by January 31Trump invokes war powers against Venezuela by January 31The first market was resolved to yes, since well, he’s out. This is where the majority of the profits were made.The others have not been resolved yet. Yet this person sold! If this person had perfect information, as has been suggested, it would be very irrational to sell these shares before the market resolves.Also, notice the rates at which he bought. It’s not like polymarket broadly believed this to be impossible at all. 10 cents means that the market thinks the odds of this happening are around 10%. You could explain this with even more insider trading. But maybe not! Maybe, in some ways, a lot of the signs were quite obvious.“Trump has repeatedly told the media that Maduro’s days in power are numbered.”The above quote is from december 31st.And if you think that this is so obviously insider trading and this person is obviously so sure, then why only bet 80k? I can’t really imagine a guy close enough to trump that he would have this amount of intel yet not have more than 80k in the bank to gamble with. And I don’t think the argument of “any more would be suspicious” really holds either here, betting $800k or $80k is about as suspicious, at the very least, the wins would outpace the odds of trouble.I think if what we were seeing was genuine insider trading, it would likely look a lot more like “buys shares at $0.01 way in advance for oddly specific date”, sells when market resolves. And as I said, that’s not what happened.Now, why is it a fresh account? I don’t know! But again, it’s not immediately obvious that “this is a fresh account” ∴ “covering up insider trading”. It could be someone making that trade that doesn’t want to be seen doing it publicly, for personal reasons. Or just someone using polymarket for the first time!Edges are naturally weirdAn “edge” is information in the market that your competitors don’t have access to, or haven’t discovered. This is what those people at jane street do all day. They find edges and exploit them.Anyone working in finance will tell you that getting an “edge” can be very bizzare stuff. Things like how shadows cast on oil barrows (I think), tracking the number of pizzas going to the white house, etc…It’s definitely possible that this person had some sort of edge, without it having been insider trading.An estimateNow, let me be a nerd for a minute alright, there’s a theorem for this! And in this specific case, we don’t have to vaguely allude to bayes theorem, we can actually run the numbers for once!3So, 4 suspicious things happened here at once! I’ll make conservative estimates for the probability of all of them.Someonebet a lot of money on a newsworthy event (let’s say, 50 yearly newsworthy events, with 10 big bets per event)on a fresh account (M) (p = 0.15, as I said, many reasons to do this on a fresh account )on a tightly timed bet (p = 0.15, a bit more suspicious, but not implausible given polymarket is relatively high frequency)and won a resolved market (p = 0.1, polymarket odds4)5So, even in a world with zero insider trading, how often would we expect to see something like this?In other words, even with zero insider trading, you should expect about one eerily perfect-looking trade per year.Not impossible!ConclusionsThere are many good arguments for this being merely a coincidence. Not every suspicious polymarket account is insider trading.That being said, do I think it was insider trading? I mean, probably, the trump administration has shown that they care way less about this sort of behavior. But on the whole, I’m not dismissing the null hypothesis here. Nothing ever happens.1This post could have been way longer, feel free to add nuance in comments, but I have exams right now, so I mustn’t get nerdsniped2much more detective work to be done here, feel free3using bayes with a prior for insider trading is probably better, but I cba today, as I said, exams.4imperfect if there was actual insider trading, but polymarket is just very good otherwise, so hard to decide probability in a different way.5Notice how he didn’t outright win the other 2 markets by the way!Discuss ​Read More

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