A Forecasting Platform Trader Profited $Nearly Half a Million from Bets Predicting the Ouster of Maduro.
A bettor made nearly half a million dollars by predicting the removal of Venezuela's president immediately preceding it was made public, raising questions about the possibility of profiting from non-public details of American actions.
Sudden Shift in Wagers
Predictions made on the forecasting site, a blockchain-based service, that the leader would be out of power by the close of the month surged in the hours before Donald Trump declared on January 3rd that Maduro had been apprehended.
One account, which registered on the site in December and took four positions, all on political events in Venezuela, profited a total of $436,000 from a starting bet of $32.5K.
Who placed the bet is a mystery. The user had only a string of letters and numbers for identification.
Probability Spikes Before Announcement
Trading information shows that participants put the odds of a political change at just under 7% in the afternoon of the Friday before the event.
However the odds had climbed to eleven percent by shortly before midnight and skyrocketed in the early hours of Saturday, pointing to a rapid movement in positions immediately prior to the public announcement was made.
"This specific wager has all the hallmarks of a bet based on inside information," commented Dennis Kelleher.
A handful of other individuals also profited significant sums from predicting the capture.
Regulatory Scrutiny Intensifies
Politicians are beginning to pay attention.
A bill introduced on Monday would prevent government employees from making trades on forecasting platforms if they have "insider details" related to a bet.
Market Background
Event-driven betting sites have grown significantly in the past few years, with participants able to predict everything from elections to politics.
The industry were examined under the last presidential term. However it has received a warmer welcome during the present political climate.
Trading on insider information is against the law in the securities markets, but there are fewer regulations in the forecasting space.
An official representative for a competing service said their site "has clear rules against insider trading of any form."
