Insider Trading: Allegations of Profiting from Non-Public Information in Commodity and Prediction Markets
The summary of an investigation by Nick Marsh, a BBC business reporter, entitled ‘The insider trading suspicions looming over Trump’s presidency’, was released on 20 April 2026. According to this report, some recent social media posts and media interviews by President Donald Trump have been preceded by a surge in bets on certain political outcomes, or on changes in Brent crude oil prices or stock market indexes, thereby enabling traders to profit from what is alleged to be “inside information.” The BBC report cited five specific examples of spikes in trading volumes on financial markets- minutes to hours before President Trump’s statements. Traders in commodity, derivatives (futures and swaps), and prediction markets may have benefited from short-selling in response to confidential, price-sensitive information originating from the White House. All such allegations have, however, been denied by the White House.
Stock markets plunged in response to President Trump’s announcement of ‘Liberation Day’ tariffs on 2 April 2025, following by a sharp increase in stock market indexes when he announced a 90-day pause in their implementation, except for China, on 9 April 2025. Bets on stock market movements generated substantial profits for traders on both occasions. Between 30 December 2025 and 2 January 2026, a bet totalling $32, 537 was placed on a newly-created Burdensome-Mix account on Polymarket, a blockchain-powered prediction market, yielding a $436,000 win for an unidentified trader after President Nicolás Maduro was kidnapped by US special forces on 3 January. Six users placed bets on Polymarket on the likelihood by US airstrikes on Iran by 28 February, winning a total of $1.2 million. A spike in bets on a fall in prices of futures contracts for Brent crude oil was observed shortly before President Trump told CBS News on 9 March that ‘the war is very complete, pretty much.’ Trades in futures contracts for Brent crude oil surged, as crude oil prices fell yet again, following a Truth Social post by Trump on 23 March about a ‘complete and total resolution to hostilities.’
Any allegations of insider trading related to the above-mentioned situations are speculative, given the information available. Indeed, in response to media concerns over the matter an email was sent to all White House staff on 24 March 2026, warning them not to use insider information to place bets on prediction markets. In the United States, insider trading is monitored by the Commodity Futures Trading Commission (CFTC), which can enforce civil penalties or criminal prosecutions on individuals and firms registered with the Commission who are found to be violating any existing regulations. Insider trading is prohibited under Section 6 (c) (1) of the Commodity Exchange Act (CEA) of 1936 and by CFTC Regulation 1801.1. The CFTC, which promotes “the integrity, resilience and vibrancy of the US derivatives market through sound regulation”, has yet to report on any evidence of insider trading-the “misappropriation of confidential information in breach of a pre-existing duty of trust and confidence to the source of the information”- in relation to President Trump’s recent statements.
Prediction markets, where participants buy and sell “events contracts” relating to the possible outcomes of a wide variety of future events, allow bets to be placed on political elections, military strikes, the outcomes of sporting contests, the weather, and many other happenings in the real world. These lightly-regulated markets have recently come under the spotlight with respect to alleged insider trading. The confidentiality of transactions in cryptocurrency on blockchain-powered platforms such as Kalshi and Polymarket, and their susceptibility to market manipulation, can be particularly appealing to certain types of users.
To sum up, knowledge is power. It can, however, also be a problem when it is unevenly shared. Ideally, all market participants should have equal access to any information that influences their trading decisions. “Asymmetrical information” benefits those with privileged access to relevant non-public information, who can then manipulate markets to maximise their profits. Insider trading can be considered a breach of trust, which ultimately compromises the integrity of markets and erodes confidence in their operations. Unfortunately, insider traders may have many tricks up their sleeves. Insider trading can be concealed by such practices as the use of financial intermediaries, shadow trading, or trades in offshore accounts, making it a potentially challenging task to uncover any wrongdoings. In any case, it seems most unlikely that we will become any wiser, over the forthcoming months, about the reasons for high trading volumes on certain markets in response to President Trump’s public utterances.
Ashis Banerjee