Israelis Arrested Over Alleged Insider Polymarket Trades on IDF Military Secrets

In brief

• Two Israelis have been arrested and accused of using classified military information to place bets on Polymarket.
• Prosecutors allege an IDF reservist shared military secrets with a civilian to make the wagers.
• Polymarket has previously suggested insider activity can improve market accuracy.

Two Israelis have been charged with using classified information to make bets about the nation’s military operations on Polymarket. The Israelis, an IDF reservist and a civilian, have been charged with severe security offenses, bribery, and obstruction of justice, according to local reports. Prosecutors have alleged the army reservist accessed classified information about Israel’s planned attack on Iran in June 2025, and then shared it with the civilian to place multiple Polymarket bets. 

Most identifying details about the case’s defendants remain classified, but prosecutors claim the pair are not senior officials in any military or government body. One of the defendants’ attorneys, however, referred to their client as “a highly regarded individual who has made a significant contribution to Israel’s security.” The attorney claimed the charges are “improper” and constitute “selective enforcement.” A joint statement on the case from Shin Bet, Israel’s counterintelligence agency, and the Israel Police, referred to the arrest of “several suspects” and multiple “reservists” in connection to insider Polymarket trades on the nation’s military activity. No further cases have yet been made public, however. The agencies said the Polymarket bets pose “a real security risk to IDF operations and to the security of the state” and are viewed by the Israeli government “with utmost severity.”

Polymarket did not immediately respond to Decrypt’s request for comment regarding the arrests, or whether the alleged trading in question violated the platform’s terms of service. Polymarket has previously appeared to boast about the proliferation of insider trading on its platform, claiming such activity increases market accuracy. The platform’s chief U.S. rival, Kalshi has attempted to frame itself as more legally compliant. Last week the company’s CEO, Tarek Mansour, made a lengthy public statement about Kalshi’s prohibition of insider trading. But days later, insiders appeared to nail several prediction market bets about surprise appearances during the Super Bowl halftime show. Shortly thereafter, during an interview with CNBC, Mansour struggled to answer when pressed on who Kalshi determined to be an insider in that situation—backup dancers, cameramen—and whether the platform took any steps to prevent such trading.