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A bettor made nearly half a million dollars from wagers on the downfall of Venezuela's president shortly prior to it was publicly declared, leading to inquiries about whether someone profited from confidential information of the event.

Changing Odds in Wagers

Bets placed on the crypto-platform, a blockchain-based service, that Nicolás Maduro would be removed from office by the close of the month increased in the time leading up to President Donald Trump declared on Saturday that Maduro had been seized.

One account, which registered on the site last month and took four positions, all on the Venezuelan situation, earned over $nearly half a million from a initial bet of $32.5K.

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

Probability Spikes Before Public Statement

Platform data shows that users estimated the likelihood of a political change at just 6.5% in the late afternoon of the Friday before the event.

But these probabilities had increased to eleven percent by the end of the day and skyrocketed in the morning of January 3rd, indicating a sharp shift in betting activity just before the public announcement was made.

"This specific wager has all the signs of a bet based on inside information," said Dennis Kelleher.

A handful of other individuals also made large payouts from predicting the capture.

Legal Questions Intensifies

Some lawmakers are growing concerned.

Proposed legislation put forward on recently aims to prohibit federal workers from making trades on prediction markets if they have "confidential government knowledge" related to a market.

The Prediction Market Landscape

Forecasting platforms have become increasingly popular in recent years, with participants able to wager on everything from sports to politics.

This sector faced scrutiny under the previous administration. But it has found a more favorable environment during the Trump presidency.

Using confidential knowledge is against the law in the securities markets, but there are fewer regulations in the forecasting space.

A company executive for Kalshi said their site "strictly forbids insider trading of any form."