A trader profited $400,000 from Maduro's arrest; US lawmakers are considering legislation to crack down on insider trading in prediction markets.

[A trader profited $400,000 from Maduro's arrest; US Representative proposes legislation to combat insider trading in prediction markets] According to Mars Finance, on January 4th, The Block reported that Punchbowl News founder Jake Sherman disclosed on Saturday that US Representative Ritchie Torres will introduce legislation called the "Public Integrity Act for Financial Prediction Markets of 2026," aimed at combating potential insider trading on prediction market platforms. The report states that the bill proposes prohibiting elected federal officials, politically appointed officials, and executive branch employees from trading prediction market contracts related to government policies or political outcomes when they possess or are reasonably likely to have access to material non-public information in the course of their duties. In the comments section of Sherman's post, the public relations account of prediction market platform Kalshi responded that its platform rules explicitly prohibit insiders or decision-makers from trading using material non-public information. The bill was proposed based on trading activity from a newly created account on Polymarket: hours before US President Trump announced the nighttime arrest of Venezuelan President Maduro by the US military, the implied probability of related contracts on Polymarket had risen abnormally. One account, after the confirmation of Maduro's arrest, turned an investment of approximately $32,500 into profits exceeding $400,000, a return of over 1200%. This account had previously only participated in predictions related to US intervention in Venezuela.