An Prediction Market User Earned $Nearly Half a Million from Bets Predicting Maduro's Downfall.
An individual profited close to $500,000 by predicting the removal of Nicolás Maduro shortly prior to it was made public, raising questions about the possibility of profiting from non-public details of the US operation.
Market Movement in Predictions
Predictions made on the forecasting site, an online prediction market, that Nicolás Maduro would be removed from office by the end of January rose in the period preceding Donald Trump declared on the weekend that the president had been seized.
A particular user, which became a member recently and made four bets, all on political events in Venezuela, made more than $436,000 from a starting bet of $32,537.
Who placed the bet is a mystery. The user had only a cryptographic address for identification.
Odds Fluctuate Before Public Statement
Market statistics shows that traders assessed the probability of Maduro's exit at just under 7% in the afternoon of the Friday before the event.
But these probabilities had jumped to over 10% by late Friday night and surged in the morning of the next day, pointing to a rapid movement in market sentiment immediately prior to the public announcement was made.
"That trade has all the hallmarks of a transaction based on inside information," said an industry expert.
Several of other platform users also made significant sums from similar wagers.
Political Attention Grows
Some lawmakers are growing concerned.
A bill introduced on the start of the week would prevent public officials from participating on prediction markets if they have "material nonpublic information" related to a wager.
Industry Context
Event-driven betting sites have surged in popularity in the past few years, with participants able to bet on everything from elections to political events.
This sector encountered regulatory challenges under the last presidential term. However it has experienced less resistance during the present political climate.
Using confidential knowledge is illegal in the securities markets, but there are less oversight in the forecasting arena.
A spokesperson for a competing service said their site "strictly forbids such activities of any form."
