A Prediction Market User Earned $436,000 on Bets on Maduro's Downfall.
A trader earned a substantial sum on the ouster of Venezuela's president shortly prior to it was made public, leading to inquiries about the possibility of profiting from confidential information of the event.
Changing Odds in Forecasts
Bets placed on the crypto-platform, a blockchain-based service, that the Venezuelan president would be no longer in control by the close of the month surged in the hours before Donald Trump announced on January 3rd that the president had been seized.
One account, which became a member last month and made four bets, all on the Venezuelan situation, earned over $436K from a initial bet of over $32,000.
It remains unclear. The user had only a string of letters and numbers for identification.
Market Signals Before News Break
Market statistics shows that users put the odds of a political change at just a low 6.5 percent in the late afternoon of Friday, January 2nd.
Yet the market's assessment had jumped to 11% by shortly before midnight and skyrocketed in the morning of the next day, suggesting a rapid movement in market sentiment just before the public announcement was made.
"This particular bet has all the hallmarks of a bet based on inside information," stated an industry expert.
A small number of other individuals also profited significant sums from bets on the same outcome.
Political Attention Grows
Politicians are starting to take note.
A new rule introduced on recently seeks to ban public officials from participating on prediction markets if they have "insider details" related to a bet.
Market Background
Forecasting platforms have become increasingly popular in the past few years, with participants able to wager on everything from sports outcomes to current affairs.
The industry were examined under the previous administration. But it has received a warmer welcome during the present political climate.
Insider trading is against the law in the traditional financial markets, but there are more ambiguous rules in the prediction market space.
An official representative for another major platform said their site "has clear rules against insider trading of any form."
