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The White House issued a formal warning to its staff on March 24 regarding the potential for insider trading within the administration.
This directive followed a suspicious flurry of activity in global markets just before the United States announced a pause in military strikes against Iran. President Trump posted the announcement on Truth Social on March 23.
Dow Jones Market Data shows that $760 million-worth in oil futures changed hands in less than two minutes. This surge occurred roughly 15 minutes before the public post. The Wall Street Journal's report also noted that Democrats are now calling for stricter regulations.
The White House Management Office sent a staff-wide email to address concerns about government officials leveraging non-public information.
This internal memo referred to recent press reports about suspicious wagers on platforms like Kalshi and Polymarket. White House spokesman Davis Ingle dismissed the claims in a statement to the BBC.
He stated that "any implication that Administration officials are engaged in such activity without evidence is baseless and irresponsible reporting."
However, the timing of the trades continues to fuel skepticism. A mysterious flurry of activity kicked off in the futures markets about 15 minutes before the sudden shift in policy.
A senior administration official described these suspicious 'monster bets' in futures markets as a primary focus of current news cycles.
Prediction markets allow anonymous users to wager on the outcomes of lethal conflicts and national security decisions.
Three accounts on Polymarket recently earned over $600,000 by correctly predicting the timing of the Iranian ceasefire.
Senator Richard Blumenthal criticized this trend in a recent press release. He argued that these platforms "are turning war into a casino game, and creating a market for national security leaks."
Critics point to several instances where outcomes appeared to be known in advance by traders.
Blumenthal and Senator Andy Kim introduced legislation last month to entirely ban prediction markets related to war or military action.
The New York Times has reported that the Trump family maintains deep ties to the prediction market industry.
Donald Trump Jr. currently serves as an adviser to both Kalshi and Polymarket. Additionally, the Trump family's social media company announced plans last year to launch its own betting service.
Traders in these markets have even adopted the term TACO, or "Trump Always Chickens Out," to describe his habit of retreating from threats when markets slide.
These connections raise questions about whether military decisions are being influenced by private financial interests. Senator Andy Kim noted that "corruption and exploitation are thriving" within the current legal loopholes.
Lawmakers now seek to impose fines up to $500 or double the profit for any official caught trading on non-public data.
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