Israeli prosecutors have filed an indictment against an Israel Defense Forces reservist and a civilian accused of using classified military information to place wagers on the blockchain-based prediction platform Polymarket.
According to reporting by multiple Israeli media, including The Jerusalem Post and The Times of Israel, prosecutors allege the reservist accessed sensitive operational intelligence through his army position and shared it with the civilian, who then used the information to place bets on Polymarket tied to military actions.
Local media said that the Tel Aviv District Court has now lifted a gag order at the request of the State Attorney’s Office cyber department. Authorities noted the suspects were arrested in a joint operation involving the Shin Bet internal security service, Israel Police, and the Defense Ministry’s security investigations unit.
Prosecutors have charged the two with serious security-related offenses, bribery, and obstruction of justice. Officials emphasized that the defendants are not senior officials in any security or government body.
The indictment follows weeks of scrutiny over unusually accurate wagers placed on prediction markets related to Israeli military operations. Israeli authorities had been examining whether insider information may have been used to profit from those markets since mid-January.
Insider trading
Polymarket allows users to buy and sell “yes” or “no” outcome contracts tied to real-world events. Built on blockchain infrastructure, the platform links accounts to crypto wallets rather than verified identities, making participation pseudonymous and globally accessible.
The case marks one of the clearest examples to date of alleged classified information being used on a decentralized prediction market. Moreover, the indictment lands amid a broader international debate over insider trading and information asymmetry on event-based betting platforms.
In January, U.S. Rep. Ritchie Torres introduced legislation targeting insider trading on prediction markets after a trader reportedly netted roughly $400,000 wagering on the capture of Venezuelan President Nicolás Maduro shortly before it was publicly announced.
© 2026 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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