First Prediction Markets Insider Trading Case Brought to Court in New York
Jesse M. Cox Published 28/04/2026
Insider trading has long been an illegal activity in stock market trading. It's what once sent iconic American TV personality Martha Stewart to prison.
For the first time in legal history, the U.S. government is filing insider trading charges in a case involving prediction markets. The U.S. Attorney’s Office for the Southern District of New York (SDNY) and the Commodity Futures Trading Commission (CFTC) have brought a first-of-its-kind insider trading case involving prediction markets, filing charges against an active-duty U.S. Army soldier.
He is facing allegations that he was using classified government information to profit from event-contract trading.
A U.S. Soldier is facing charges of using classified information to profit from Polymarket
Gannon Ken Van Dyke, a U.S. Army Special Forces Master Sergeant based out of Fort Bragg, North Carolina, is accused of using nonpublic classified information regarding a covert U.S. military operation to gain profit from purchases of event contracts on the prediction market platform Polymarket. The operation in question was “Operation Absolute Resolve.” That operation targeted Venezuelan leader Nicolás Maduro for removal. Filing of the indictment - United States v. Van Dyke, 26 Cr. 156 (SDNY) - was taking place on April 23.
“Prediction markets are not a haven for using misappropriated confidential or classified information for personal gain,” U.S. Attorney Jay Clayton stated in a press release. Clayton went on to describe Van Dyke's actions as constituting “clear insider trading, and is illegal under federal law. Just because it’s a prediction market doesn’t insulate you from fraud."
The indictment charges Van Dyke with five counts: unlawful use of confidential government information for personal gain); theft of nonpublic government information); commodities fraud; wire fraud, and engaging in a monetary transaction in property derived from specified unlawful activity.
The press release was also noting that the indictment and the description of the indictment “constitute only allegations and every fact described should be treated as an allegation.”
Van Dyke took significant measures to attempt to conceal his insider trading
According to filings in the indictment, Van Dyke took great measures in an effort to conceal his activity. He utilized sophisticated methods to hide his conduct. This included the use of a virtual private network that geolocated to a foreign country. Van Dyke also made use of cryptocurrency transfers in an attempt to disguise who was receiving the funds. He earned more than $400,000 through his trades.
The indictment also alleges that after cashing out, Van Dyke went about deploying efforts to delete his Polymarket account. He was “falsely claiming that he had lost access to the email address to which the account had been associated.”
A key element of the government’s allegations against Van Dyke is that the classified information he accessed belonged to the government. Van Dyke had executed multiple nondisclosure agreements. Through these agreements, he acknowledged that classified information “remains the property of the United States Government,” establishing a duty of trust and confidentiality.
The CFTC has initiated civil action regarding this case
Parallel to the indictment filed against Van Dyke, the CFTC has initiated civil enforcement action.
"This is the first time the CFTC has charged insider trading involving event contracts,” CFTC Chairman Michael Selig noted in a press release.
Selig reiterated the agency’s position in matters of this nature. “I have been crystal clear that anyone who engages in fraud, manipulation, or insider trading in any of our markets will face the full force of the law,” Seilg stated.