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An individual made nearly half a million dollars by predicting the removal of the Venezuelan leader just before it was officially announced, raising questions about the possibility of profiting from confidential information of the US operation.

Sudden Shift in Predictions

Wagers on Polymarket, an online prediction market, that the Venezuelan president would be removed from office by the month's conclusion increased in the hours before former President Trump stated on January 3rd that Maduro had been taken into custody.

A single trader, which joined the platform last month and took four positions, all on political events in Venezuela, profited a total of $436,000 from a modest bet of over $32,000.

The identity is unknown. The anonymous account had only a string of letters and numbers for identification.

Probability Spikes Before Announcement

Market statistics shows that participants assessed the probability of Maduro's exit at just under 7% in the late afternoon of Friday, January 2nd.

However the market's assessment had increased to eleven percent by the end of the day and spiked dramatically in the morning of the next day, suggesting a sharp shift in betting activity right before the public announcement was made.

"This specific wager has all the hallmarks of a bet based on inside information," stated an industry expert.

Several of other traders also earned significant sums from similar wagers.

Regulatory Scrutiny Emerges

Elected officials are growing concerned.

A new rule presented on the start of the week seeks to ban public officials from participating on prediction markets if they have "confidential government knowledge" related to a bet.

Market Background

Prediction markets have become increasingly popular in the past few years, with users able to predict everything from sports to political events.

The industry encountered regulatory challenges under the previous administration. Yet it has found a more favorable environment during the current presidency.

Using confidential knowledge is illegal in the traditional financial markets, but there are fewer regulations in the forecasting industry.

A company executive for Kalshi said their site "has clear rules against such activities of any form."