The Pentagon prohibits the U.S. military from betting on prediction markets using military information

U.S. Secretary of Defense Lloyd Austin has prohibited all Pentagon personnel from using non-public information to place bets on upcoming military operations, involving prediction market platforms such as Kalshi and Polymarket. In a memo sent to senior Pentagon officials and defense agencies on Tuesday, he stated that all Department of Defense personnel are prohibited from using non-public information for financial transactions, with the relevant restrictions covering both classified and unclassified information.

Austin wrote in the memo that adversaries will observe movements in these markets, and the safety of U.S. military personnel often depends on the enemy not knowing what is about to happen. He also pointed out that, aside from operational security, financial betting can distort judgment: a logistics personnel betting on the date of an operation will be concerned about that date, and an analyst holding a position on the outcome will also be concerned about that outcome.

Before this directive was issued, U.S. Army soldier Gannon Ken Van Dyke was charged in April for allegedly profiting over $400,000 on Polymarket by using classified information regarding the operation to capture Venezuelan leader Nicolás Maduro. Prosecutors claimed he participated in the planning and execution of the operation and used advance knowledge to bet on the outcome of Maduro's ousting; he pleaded not guilty to all charges. In February, Israeli authorities also arrested and charged a military reservist and a civilian for allegedly using classified information to bet on events related to Israeli strikes against Iran on Polymarket.