After soldier allegedly wins $400,000 betting on Maduro's capture, Polymarket says it's tightening security
One week after a special forces soldier was indicted on charges of using classified information to wager on the capture of Venezuelan President Nicolas Maduro, the prediction market Polymarket announced it is increasing its internal monitoring of trades.
Master Sgt. Gannon Ken Van Dyke, who prosecutors say helped plan and execute the raid on Maduro's Caracas compound, allegedly made more than $400,000 on Polymarket by using insider knowledge to place 13 bets on the outcome of the operation.
On Thursday, Polymarket announced that it had tapped a blockchain data company to continually monitor the platform for suspicious trades.
Polymarket and analytics firm Chainalysis said they are working together on a "first-of-its-kind" system to enforce the Polymarket's market integrity rules by monitoring transactions on-chain -- referring to the platform's public disclosure of transaction data.
"Polymarket was built on-chain because transparency matters, and our platform shows what markets can look like when trades are open, traceable, and accountable by design," Polymarket CEO Shayne Coplan said in a statement.
Through the partnership, the company is looking to confront the longstanding challenge of insider trading by leaning into a decentralized solution based on the public blockchain -- essentially a distributed database -- on which it can follow the tracks of every trade based on data that's permanently stored and sealed with unique identifier.
Chainalysis says they will use their technology to quickly provide law enforcement with "blockchain-verified evidence" to proactively identify threats.
While Polymarket already had a monitoring system for insider trading, both companies say the new partnership will help them quickly identify patterns that suggest an trader with insider knowledge is placing bets.
"With this collaboration, on-chain markets have the potential to be the most trustworthy markets for understanding world events," Chainalysis CEO Jonathan Levin.
Online sleuths have been successful in flagging suspicious trades such as the bet that prosecutors say Van Dyke placed on Maduro's capture. Posts about the suspicious wager began appearing online within hours of the trade, and prosecutors then took about four months to build their case.
Van Dyke pleaded not guilty to all charges Tuesday in Manhattan federal court and was released on bond.
