Senator Chris Murphy Drafts Bill to Curb War Linked Prediction Bets

TLDR

• Murphy to introduce bill banning war related prediction bets

• Six wallets earned about $989,000 before Iran strikes

• Largest wallet turned $60,816 into $494,375 profit

• Kalshi and Polymarket logged $18.3B February volume

Senator Chris Murphy said he will introduce legislation to restrict betting on government actions. The proposal would target prediction markets tied to military strikes and official policy decisions.

Murphy cited concerns after traders profited from wagers placed before U.S. and Israeli airstrikes on Iran. He said the bill will be introduced later this month.

Onchain Data Shows Profits Before Airstrikes

Blockchain analytics firm Bubblemaps identified six newly funded wallets linked to a Polymarket contract. The contract asked whether the United States would strike Iran by February 28, 2026.

According to the data, the wallets netted a combined $989,191. The trades occurred hours before the military action began. The largest wallet turned a $60,816 position into $494,375 in profit. It bought 560,680 “yes” shares priced at 10.8 cents each.

Last Friday, a handful of people made big, unusual $100,000+ bets on Polymarket – that the U.S. would strike Iran the next day.

The Iran War is fueling a new kind of corruption: White House officials secretly profiting off war.

It’s disgusting. We need to ban it. pic.twitter.com/qs0aEzqemD

— Chris Murphy ???? (@ChrisMurphyCT) March 4, 2026

Another wallet known as “Planktonbets” recorded $173,907 in profit across seven predictions. A third wallet called “Dicedicedice” earned $119,964 on a single trade.

Murphy said individuals with advance knowledge may have placed the bets. In a video shared on X, he stated,

“It is very likely, probable even, that the people that placed those bets were people with inside information.”

Legislation Targets Government Action Contracts

Murphy said the bill would prohibit trading on markets tied to war making or political speeches. He argued that such contracts create risks when insiders hold sensitive information.

He said,

“If we continue to allow people to bet on war, then you’re going to have people inside the situation room making decisions not based on national security.”

Business Insider reporter Bryan Metzger said Murphy confirmed the bill would include exceptions. Financial market contracts, such as those tied to Federal Reserve decisions, would remain permitted.

Representative Mike Levin is preparing a companion measure in the House. Levin cited a Polymarket account named “Magamyman” that reportedly earned about $515,000 in one day.

The trader placed the first wager 71 minutes before news of the strike became public. The position was entered when the market probability stood near 17 percent.

Growing Scrutiny of Prediction Platforms

Concerns about insider trading on prediction markets have surfaced in earlier cases. In January, a newly created account wagered on political developments in Venezuela before public announcements.

Israeli prosecutors recently indicted an Israel Defense Forces reservist and a civilian. They allegedly used classified intelligence to place bets on the timing of a prior strike on Iran.

Despite the scrutiny, trading volumes have continued to rise. Data shows Kalshi recorded $10.4 billion in trading volume in February. Polymarket logged $7.9 billion during the same month. Combined activity across both platforms reached roughly $18.3 billion.

Kalshi operates as a regulated platform under oversight from the Commodity Futures Trading Commission. Polymarket runs on blockchain infrastructure and allows anonymous participation.

Lawmakers from both parties have called for tighter oversight. Some have argued that betting on geopolitical events raises concerns about market integrity and access to sensitive information.