U.S. military soldiers betting on Maduro's ousting net $400k profit and getting arrested; first insider trading case settled in Polymarket

Author: Claude, Deep Tide TechFlow

Deep Tide Guide: On Thursday, the U.S. Department of Justice arrested U.S. Army Special Forces Sergeant Gannon Ken Van Dyke, accusing him of using confidential information obtained during his participation in the raid on Venezuelan President Maduro’s operation to place bets on Maduro’s ouster on Polymarket with a principal of $33,000, netting over $409,000. This is the first case in which the U.S. Department of Justice has prosecuted insider trading in prediction markets, and also the first time the U.S. Commodity Futures Trading Commission (the “CFTC”) has invoked the “Eddie Murphy Rule” to bring charges against conduct involving the misuse of non-public government information.

An American special forces operator involved in the capture operation targeting Maduro used confidential intelligence to bet and profit $400,000 in a prediction market—yet he is now also the defendant.

According to an April 23 announcement by the U.S. Department of Justice, Army Special Forces Sergeant Gannon Ken Van Dyke (38, stationed at Fort Bragg in North Carolina) was arrested and charged by federal authorities for allegedly using confidential information to trade and profit on the prediction market Polymarket. The indictment shows that Van Dyke participated in the planning and execution of an operation code-named “Operation Absolute Resolve,” which at the early hours of January 3, 2026, in Caracas, detained Venezuelan President Maduro and his wife.

According to the indictment, Van Dyke opened a Polymarket account on December 26, 2025. Between December 27 and January 2, he placed a total of 13 bets with total funds of approximately $33,034, all betting on the “Yes” side. The bets covered four contracts: “Maduro steps down before January 31,” “U.S. invades Venezuela,” “U.S. military enters Venezuela,” and “Trump’s war powers bill against Venezuela.”

His final net profit was approximately $409,881. The largest single bet was $32,537 on “Maduro steps down before January 31,” with a return of 1,242%, yielding a profit of $404,222.

The case is now in motion: DOJ and the CFTC strike in parallel

This is the first criminal lawsuit filed by the U.S. Department of Justice against insider trading in prediction markets, and also the first time the CFTC has brought charges against insider trading involving event contracts.

In parallel, the CFTC filed a civil lawsuit in the U.S. District Court for the Southern District of New York, seeking to require Van Dyke to return profits, pay civil penalties, and permanently bar him from participating in futures trading. In a statement, CFTC Chairman Michael S. Selig said that the defendant’s conduct harmed U.S. national security and put a servicemember’s life in danger.

Van Dyke is charged with five federal offenses: three counts of violating the Commodity Exchange Act (each carries a maximum penalty of 10 years in prison), one count of wire fraud (up to 20 years in prison), and one count of illegal money trading (up to 10 years in prison).

The legal basis for this case is especially worth noting. According to Axios, the CFTC relies on the so-called “Eddie Murphy Rule,” which comes from Section 746 of the 2010 Dodd-Frank Act and is named after the movie Trading Places. The rule clearly prohibits commodity trading using stolen or misused non-public government information.

Unsuccessful evidence destruction afterward—Polymarket proactively cooperates with the investigation

The indictment also reveals Van Dyke’s cover-up actions after he profited from his bets.

On the day of the operation (January 3), Van Dyke quickly withdrew most of the proceeds from his Polymarket account, transferring them to an overseas cryptocurrency vault, and then deposited them into a newly opened online brokerage account. On January 6, when the media and social platforms began reporting abnormal trading on Polymarket related to contracts tied to Maduro, Van Dyke requested that Polymarket delete his account, claiming he had lost access to the registered email. That same day, he also changed the registered email for his cryptocurrency exchange account to an address not under his own name—an email that had been registered as early as December 14, 2025.

According to the indictment, a photo of Van Dyke was uploaded to his Google account just hours after the operation ended. The photo shows him wearing U.S. military combat gear, holding a rifle, standing on the deck of a warship with three other servicemembers, with a sea sunrise in the background.

Polymarket issued a statement on the X platform saying that after the company discovered that a user was trading using confidential government information, it proactively referred the matter to the Department of Justice and cooperated with the investigation throughout. Neal Kumar, Polymarket’s Chief Legal Officer, said the platform is not anonymous and that users will be found—just like that person.

Insider-trading risks in prediction markets go far beyond the Maduro case

Van Dyke’s case is not an isolated incident. Concerns about insider trading surrounding Polymarket have created systemic pressure.

In February this year, Israeli authorities arrested and charged a reservist and a civilian, alleging that the two used confidential information about Israel’s military action against Iran to profit on Polymarket.

In March, an account with the username “Magamyman” began placing bets about 71 minutes before the joint U.S.-Israeli airstrikes against Iran, and ultimately profited approximately $553,000.

And just yesterday, someone heated a temperature sensor near Charles de Gaulle Airport in France using a hair dryer, thereby affecting the weather data reported by a weather station—and then profited from the weather forecasts in prediction markets.

On Thursday, when asked about the case during a press briefing at the White House, Trump said it was like Pete Rose betting that his team would win. He then added that, unfortunately, the whole world has turned into some kind of casino and said he was not satisfied with such bets on prediction markets.

The compliance dilemma for prediction markets is that Polymarket’s international site operates on the Polygon blockchain and is set up outside the U.S. regulatory scope, allowing users to access it via a VPN. Although the CFTC approved Polymarket to operate in the U.S. last year, its U.S. site has not yet fully launched.

The Trump family also has commercial ties to Polymarket. The president’s son, Donald Trump Jr., serves as an adviser to Polymarket, and his venture capital firm, 1789 Capital, has invested millions of dollars into the platform.