NEW YORK CITY, New York: U.S. lawmakers are calling for investigations into prediction market platform Polymarket after a series of unusually well-timed bets on geopolitical events raised concerns about potential insider trading.

At least 50 newly created accounts placed large bets on a U.S.-Iran ceasefire just hours, and in some cases minutes, before President Donald Trump announced the development early this week on social media, according to a report by The Associated Press. These were the only bets made by those accounts.

The activity follows other instances of strikingly accurate wagers. In January, an anonymous user reportedly made a US$400,000 profit by betting that Venezuelan leader Nicolas Maduro would be removed from office shortly before he was captured. Ahead of the Iran war, another account made roughly $550,000 betting that the U.S. would strike Iran and that Supreme Leader Ali Khamenei would be removed.

Such trades have intensified scrutiny of prediction markets, with critics warning that the platforms may be vulnerable to insider activity.

Last month, research from Harvard University estimated that individuals with potential access to nonpublic information may have generated about $143 million in profits on Polymarket. The study, based on blockchain data, cited bets on events ranging from a possible engagement involving Taylor Swift to the awarding of the Nobel Peace Prize.

Representative Ritchie Torres, a Democrat from New York, has asked the Commodity Futures Trading Commission to investigate the trades. In a letter shared with the AP, Torres said the pattern raises "serious concerns" that some participants may have had access to "material nonpublic information."

"What is the statistical likelihood that anyone other than an insider trader would place a winning bet 12 minutes before a market-moving presidential announcement?" Torres said. "There are two answers: God, or an insider trader. And something tells me that God is not placing bets around Donald Trump's posts on Truth Social. "

Prediction markets such as Kalshi and Polymarket allow users to wager on a wide range of outcomes, from weather patterns to interest rate decisions.

Polymarket has limited access in the United States after being banned in 2022, though it has taken steps to re-enter the market by acquiring a CFTC-regulated exchange and clearinghouse. It has begun a limited domestic rollout.

The company also operates a larger crypto-based platform offshore, which remains outside U.S. jurisdiction and accounts for most of its activity.

Senator Richard Blumenthal, a Democrat from Connecticut, has also demanded answers from the company. In a letter, he questioned why Polymarket allows trading on events related to war and violence and whether it has safeguards to prevent insider trading.

"Polymarket has become an illicit market to sell and exploit national security secrets unlike any in history, and by extension a potential honeypot for foreign intelligence services watching for those same suspicious bets and wagers," Blumenthal wrote.

Republican lawmakers have also criticized such platforms and called for restrictions. At least two bipartisan bills aimed at regulating or banning certain types of prediction market bets are currently under consideration in Congress.

"We don't want to imagine a world where America's adversaries use prediction markets to anticipate our next move," said Representative Blake Moore.

Polymarket did not immediately respond to a request for comment.

The scrutiny comes at a critical time for both Polymarket and Kalshi, as they seek to expand operations in the United States, including into the lucrative sports betting market.

Kalshi, which is already regulated domestically, aims to become the leading prediction market platform and has expanded into sports-related contracts. Both companies have also entered partnerships with sports teams and media organizations to broaden their reach.

The issue also carries political overtones. Donald Trump Jr. is an investor in Polymarket through his firm 1789 Capital and separately serves as a paid strategic adviser to Kalshi.