WASHINGTON -- Alarm bells went off inside the White House Counsel's Office earlier this year when anonymous Polymarket accounts first bet five-figure sums that President Trump and Iran would agree to an initial ceasefire by the end of April.
Senior officials privately raised concerns that the users may have leveraged inside information to secure an easy payday on the prediction market, according to people familiar with the matter. White House lawyers spoke with staff, asking who from the hundreds of aides working inside the building could be making bets.
These lawyers concluded it would be nearly impossible to determine whether administration officials were behind the bets because Polymarket allows users to open accounts anonymously, the people said, even though authorities have successfully traced the proceeds of those wagers. Instead, officials sent a warning shot: a late March memo telling staff they were prohibited from using nonpublic information for financial benefit. Three anonymous Polymarket accounts later made over $600,000 correctly betting on the April ceasefire announcement, according to blockchain research firm Bubblemaps.
White House officials are among those grappling with how deeply political betting has worked itself into the fabric of Washington, a town that runs on information traded in the marble halls of Congress, on the sidelines of campaign events and at after-work happy hours on K Street. The exploding popularity of prediction markets such as Polymarket and Kalshi with young staffers who have access to this information has created a pervasive temptation that is growing in advance of November's elections.
The latest example centers on Trump's teleprompter operator, Gabriel Perez. The White House confirmed this week that he is under investigation by the Commodity Futures Trading Commission for making over $100,000 in wagers based on early access to presidential speeches. White House press secretary Karoline Leavitt said the White House was unaware of his bets and pointed to ethics guidelines banning employees from making them. She said Trump is furious over the notion of officials within his administration trading on inside information. Perez has been placed on unpaid leave and couldn't be reached for comment.
Two previously unreported election bets were placed around the 2024 presidential race based on tips that Trump would pick JD Vance as his running mate, according to people familiar with those incidents. Members of Congress and campaign aides are keeping close track of betting odds ahead of key elections, with some seeing them as a better gauge of public sentiment than polling.
Political betting on Polymarket doubled to just over $4 billion during the first three months of the year compared with the first quarter of 2025, according to data provided by the nonprofit Anti-Corruption Data Collective. Election-related bets account for over $325 million. Kalshi, meanwhile, has blocked dozens of campaign staffers from using the platform to bet on their own candidates, according to a company spokeswoman.
"Our teams work 24/7 to monitor and flag any anomalous trading patterns, and we investigate every single one of them," Elisabeth Diana, the spokeswoman for Kalshi, said in a statement. A spokeswoman for Polymarket said the company monitors for potential insider trading and has made over 100 referrals to law enforcement.
Polymarket has a data partnership with Dow Jones, the publisher of The Wall Street Journal.
Federal regulators are taking notice. The Commodity Futures Trading Commission, the agency charged with regulating the prediction markets, has requested information from both Kalshi and Polymarket regarding wagers related to political and military events. Their challenge is that insider-trading laws weren't designed for prediction markets that allow bettors to wager on everything from the color of the president's tie to the top of each party's ticket.
White House spokesman Davis Ingle told the Journal earlier this month that administration officials are prohibited from using nonpublic information for their own financial gain, and said any implication that administration officials engaged in such activity without evidence is baseless and irresponsible reporting. Days later, news of Perez's betting surfaced. Ingle on Friday declined to address the issue further.
Over lunch at the Stovall House, a popular members-only social club in Tampa, U.S. Rep. Anna Paulina Luna of Florida told associates in the summer of 2024 that she knew Trump would choose Vance to be his vice president, according to a person familiar with the conversation. She said she had tipped off Rogan O'Handley, a popular MAGA influencer known as "DC Draino," about Trump's pending decision so that he could use the information to place a winning bet on Polymarket, the person said. The congresswoman teased O'Handley, the person said, for not placing a bigger wager.
O'Handley separately told associates that he was behind a long-shot attempt, mostly via social media, to get Trump to consider Luna as his running mate, according to a second person who heard O'Handley discuss the matter. When the congresswoman told O'Handley that Vance would get the nod instead, he placed a winning bet on Polymarket, the person said.
Luna said that she didn't have knowledge of who Trump would eventually choose as his running mate. "l am honored the WSJ thinks I am telepathic but unfortunately I am not," the congresswoman said in a statement, adding that she would "continue to champion the fight against insider trading."
Reached for comment, O'Handley denied receiving, trading on or discussing nonpublic information about Trump's vice presidential pick. "Any suggestion that I traded on confidential information or discussed doing so is inaccurate," he said in a statement.
The CFTC is investigating the allegation, according to a third person familiar with the matter. Not all investigations are indicative of wrongdoing.
O'Handley said he was unaware of any federal investigation and denied wrongdoing. A Luna spokesman said that the congresswoman had initiated a criminal complaint with the CFTC alleging someone had made knowingly false reports to that agency.
A 'kid' leaking
Mark Moran, a former investment banker, said he got the early inside track on who Trump would choose as his running mate over dinner at L'Annexe, a swanky Georgetown cocktail bar. The information, he said in an interview, came from Jake Denton, then a research associate at the conservative Heritage Foundation, one month before Trump's pick became official.
Based on the tip, he placed a $900 bet on Vance using the Polymarket app, he said in an interview. "I'm doing Vance," Moran said in a message to Denton, according to a record he provided to the Journal. Then he encouraged other friends to get in on the action based on the information he said he received from Denton. "I got a kid in the Heritage Foundation who has been leaking this to me," he wrote to an associate, "so went all in on Vance."
He made over $600 on the exchange, according to cryptocurrency records Moran provided to the Journal. The financier later launched his own long-shot bid for Senate, challenging Sen. Mark Warner, (D., Va.) as an independent.
Kalshi has since accused Moran of breaking its rules by betting on his own race. Denton now works as a White House policy adviser after a stint at the Federal Trade Commission. He didn't respond to requests for comment. A White House official said Denton's private comments about Vance becoming Trump's running mate weren't based on insider knowledge.
Kalshi's beer garden party
The Senate passed a resolution in April banning lawmakers in the upper chamber, and their staff who are often privy to sensitive information, from betting on Kalshi and Polymarket. The possibility of government insiders toying with prediction markets also led House Oversight Committee Chairman James Comer, (R., Ky.,) to launch an investigation last month into potential insider trading.
The focus of the probe includes suspicious betting activity related to U.S. and Israeli military operations in Iran, as well as U.S. actions in Venezuela, including the capture of Venezuelan strongman Nicolás Maduro. An oversight spokesman told the Journal that both companies are complying with the inquiry.
The new influence of betting markets is also showing up in Washington's social scene.
Kalshi hosted a party in June at a beer garden next to Nationals Park to celebrate the annual congressional baseball game. Representatives from the company mingled with guests, including congressional staff, while making the most of the open bar.
Guests included Collin Sabine, the legislative director for Rep. Pat Harrigan. The North Carolina Republican co-sponsored a bill earlier this year that bars members of Congress, their spouses and dependent children from purchasing stocks in publicly traded companies. A spokeswoman for Harrigan said his staff attending the event wasn't an indication of support for or use of Kalshi's prediction market platform. She also said Harrigan doesn't gamble or use prediction markets.
Nearby, Tony Hanagan, a former Senate Republican leadership aide, worked the room. Days before the party, he officially registered as a lobbyist for Kalshi, according to a disclosure form. Though Senate rules bar Hanagan from lobbying anyone in that congressional chamber for a year, his disclosure makes clear he will be in contact with members of the House and their staff. He now serves as Kalshi head of congressional affairs. Hanagan didn't return a request for comment.
The party kept going strong well past the first pitch of the congressional baseball game. An hour after the event started, the bar tab already exceeded $1,000.
(END) Dow Jones Newswires
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