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Posted by Joshua Scheer
As thick plumes of smoke rose over residential neighborhoods in Tehran as U.S.–Israeli airstrikes shook the Iranian capital. Within hours, another reality was coming into focus—not on the battlefield, but on a blockchain ledger.
On the prediction platform Polymarket, six newly created accounts reportedly netted around $1 million betting that the United States would strike Iran by February 28—the very day President Donald Trump announced the bombing campaign.
Some of the wagers were placed just hours before the first explosions were reported.
“This is insane that this is legal,” Sen. Chris Murphy wrote, accusing those close to power of profiting “off war and death.” Rep. Mike Levin demanded oversight and transparency, noting that Donald Trump Jr. sits on Polymarket’s advisory board and that his firm invested heavily in the platform last year.
There is, as of now, no direct evidence tying administration officials to the bets. But the optics are devastating. And the structure of the market raises deeper questions about how war is monetized in the digital age.
We must also remember Trump’s relationship to Polymarket. The idea that those connected to power could profit from wars they help initiate is not just disturbing—it represents a profound moral collapse. Profiting from destruction you set in motion is the very definition of imperial decay. This is Rep. Mike Levin (D-Calif.) wrote that “prediction markets cannot be a vehicle for profiting off advance knowledge of military action” and demanded “answers, transparency, and oversight.”
“Reminder that Donald Trump Jr. sits on Polymarket’s advisory board and his firm invested double-digit millions into the platform last year,” Levin wrote, referring to the president’s eldest son. “The [Justice Department] and [Commodity Futures Trading Commission] both had active investigations into Polymarket that were dropped after Trump took office.”
A Market for Missiles
According to Bloomberg’s reporting, roughly $529 million was traded on contracts tied to the timing of a U.S. strike on Iran. The most popular date—February 28—attracted about $90 million in volume.
The accounts flagged by blockchain analysts were all created in February. They placed bets exclusively on whether and when the U.S. would attack Iran. Some bought shares at around ten cents apiece before the bombs fell.
Blockchain analytics firm Bubblemaps noted the pattern resembles previous suspected insider trading in prediction markets. But as analysts acknowledge, the line between informed speculation and privileged knowledge is difficult to prove.
That ambiguity is precisely the problem.
Polymarket operates largely offshore, beyond direct U.S. regulatory oversight. All that’s required to trade is a crypto wallet. In times of geopolitical tension—when military action is openly discussed but operational details are closely held—the temptation to exploit proximity to power becomes obvious. As one tech outlet put it bluntly: everything is gambling now—even human suffering.
However, there might be a line.
OpenAI has fired an employee following an investigation into their activity on prediction market platforms, including Polymarket, according to reporting by WIRED. OpenAI’s CEO of Applications, Fidji Simo, disclosed the termination in an internal message to employees earlier this year. The employee, she said, “used confidential OpenAI information in connection with external prediction markets (e.g. Polymarket).”
“Our policies prohibit employees from using confidential OpenAI information for personal gain, including in prediction markets,” spokesperson Kayla Wood said. OpenAI has not revealed the name of the employee or the specifics of their trades.
Getting slightly off on a tangent—though not really, since OpenAI was just in the news over a Defense Department contract—if even a private tech company recognizes that betting with privileged information crosses a line, the question becomes unavoidable: why does that line seem so much blurrier when war and geopolitics are involved? And more importantly, why don’t these tech bros call out their own systems—and those of Polymarket—which rely on AI and increasingly operate as merchants of death?
It’s a strange world we live in: they will fire one employee for ethical violations tied to prediction markets, while at the same time negotiating lucrative defense contracts.
Consider the recent clash between the Pentagon and Anthropic OpenAI most hated rival. The company reportedly sought contractual assurances that its AI would not be used for domestic surveillance of Americans or for autonomous lethal weapons. The Defense Department rejected the idea that a private firm could dictate how its tools are used for national security purposes. When the two sides failed to reach agreement by a deadline, Defense Secretary Pete Hegseth labeled Anthropic a “supply-chain risk to national security,” effectively cutting it off from federal business. Donald Trump escalated the rhetoric further, publicly attacking the company.
Amid that standoff, OpenAI and its CEO Sam Altman signaled public sympathy for the view that AI should not be used for domestic surveillance or autonomous weapons. Yet at the same time, Altman entered negotiations with the Pentagon over a potential deal reportedly worth hundreds of millions of dollars. Unlike Anthropic, OpenAI agreed that its technology could be used for all lawful purposes, while seeking to embed internal safeguards governing how its systems are deployed.
So we are left with a contradiction: public commitments to safety and ethics on one hand, expanding defense relationships on the other. If insider betting on war crosses a moral line, what about building the tools that make modern warfare and surveillance more efficient? The markets may be betting on conflict—but the infrastructure behind them is being built in plain sight.
From “Wisdom of the Crowd” to War Profits
Polymarket defended its decision to allow betting on war, calling prediction markets an “invaluable” source of clarity in chaotic times. According to the company, these markets provide answers that traditional media and social platforms cannot. With founder Shayne Coplan, calling his site a “truth machine” whatever the fuck that means.
Contracts currently allow betting on when Iran will have a new supreme leader, when the U.S. and Iran will reach a ceasefire, and whether neighboring countries will join the fight. Earlier markets even tracked whether Ayatollah Ali Khamenei would no longer hold office by a specific date—without excluding death as a qualifying event.
The moral hazard is glaring: when financial incentives align with destabilization, escalation, or assassination, the logic of the market pushes in one direction.
War becomes not just a geopolitical act—but a tradeable asset.
Polymarket has also allowed betting on the suffering in Gaza, because if you’re in with the devil for a dollar, you might as well go the whole way.
Who Benefits?
Even if no insider trading is ultimately proven, the episode reveals a disturbing asymmetry:
- Those with access to corridors of power may gain informational advantages.
- Those in targeted cities absorb the consequences.
- Platforms collect fees either way.
Prediction markets defenders argue that they aggregate dispersed knowledge and improve forecasting. Critics counter that they can just as easily amplify rumor, incentivize leaks, or reward proximity to classified decision-making.
The deeper question is not whether a few bettors got lucky.
It’s whether we have normalized a system in which geopolitical violence doubles as a revenue stream.
The Larger Collapse
The controversy arrives at a moment when corporate media outlets face criticism for muted scrutiny of executive power. As independent outlets struggle for funding, venture-backed platforms are monetizing volatility itself.
War is spectacle. Spectacle drives engagement. Engagement drives liquidity.
And liquidity drives profit.
In that ecosystem, bombs are no longer just instruments of statecraft. They are market catalysts.
The calls for investigation are mounting. Lawmakers are pushing for tighter oversight of prediction markets and clearer prohibitions on contracts tied to violence or death. Yet, as with so many things during this hectic last gasp of the United States’ reign, most likely nothing will come of it—window dressing in full effect.
The smoke over Tehran may eventually clear. But as war becomes just another asset class—priced, traded, optimized—then the moral center of public life erodes further leading to the question is whether the normalization of betting on the next strike will linger long after—and whether it will ultimately be our own demise, which of course we can now bet on. I wonder how much I could make predicting the end of the world, because with each passing day it feels closer and closer to coming to fruition. Greed is good, even into the bitter end.
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