Pentagon Bans Troops From Betting on Military Secrets on Prediction Markets

Hegseth's memo covers classified and unclassified information alike, six months after a soldier was charged with turning Polymarket bets on the Maduro raid into almost $410,000.

Francis Gable

23/10/26 · 2 minOctober 23, 2026 · 2 min read

Defense Secretary Pete Hegseth has barred U.S. troops, intelligence staff and Defense Department civilians from using nonpublic information to bet on military outcomes, in a memo dated Oct. 20 that names Polymarket and Kalshi.

The order follows the April arrest of an Army soldier who allegedly turned about $33,000 in Polymarket bets into almost $410,000 by trading on the timing of the raid that captured Venezuelan leader Nicolás Maduro. Breaking the new rule can bring discipline or criminal charges.

Memo Reaches Sportsbooks as Well as Prediction Markets

The ban covers "traditional betting platforms" as well as prediction markets, according to DefenseScoop, which obtained the memo. It applies whether the bet rests on classified or unclassified information.

"Our enemies watch movements in these markets. When an American Service member, intelligence professional, or other Department civilian engages in a financial transaction on a military outcome, they create a signal."

Hegseth wrote that hostile foreign intelligence services can collect those signals to anticipate U.S. movements, targets and timing. He also argued that money warps judgment: "A logistician with money riding on a strike date has an interest in that date."

Violators face discipline and possible criminal charges under federal law or the Uniform Code of Military Justice, the military's own criminal law.

Maduro Raid Case Is Already in Court

The Justice Department charged Master Sgt. Gannon Ken Van Dyke on April 23. Prosecutors say the 38-year-old Fort Bragg soldier learned of the operation through his Army role and placed about 13 bets between Dec. 27, 2025, and Jan. 26, 2026. U.S. forces carried out the raid before dawn on Jan. 3.

Van Dyke faces commodities fraud, wire fraud and money charges. He has pleaded not guilty, CBS News reported.

CNN reported in August that more than 150 Polymarket wallets may have traded on military insider information. Reuters reported the same month that Polymarket had referred dozens of potential cases to the Justice Department.

Van Dyke's case is pending in Manhattan federal court, where each of his three commodities counts carries up to 10 years in prison.

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