Written by: Maher, Foresight News

On February 28, the United States and Israel launched airstrikes against Iran, resulting in the death of Iran's Supreme Leader Ali Khamenei. This attack shocked the geopolitical landscape of the Middle East, and even in the 21st century, the flames of war continue to spread, with its effects also stirring up huge waves in the prediction markets of the crypto world.

Polymarket and Kalshi became another "battlefield" outside the actual conflict, as traders bet on the timing of the attacks, regime changes, and ceasefire dates, with trading volumes skyrocketing to astronomical figures.

In war, there are always those who make a fortune quietly.

Polymarket has become a "barometer" of the conflict. Since December of last year, they have opened a market on "When will the U.S. strike Iran," covering various date options.

The prediction market "Will Khamenei step down before February 28?" saw a single-day trading volume of up to $95.93 million on February 28, becoming one of the largest geopolitical markets in the platform's history, with a trading volume of $54.15 million on March 31.

After the attack was confirmed, this market quickly settled to "yes" (still in the final dispute period), as Khamenei's death directly resulted in him "stepping down."

Although Polymarket currently does not charge any trading fees on the vast majority of conventional markets on the platform (including all political, geopolitical, pop culture, and long-term macro events), at the beginning of 2026, Polymarket introduced fees for specific high-frequency trading markets, and its brand expansion has had a significant positive impact on revenue growth.

Moreover, Polymarket's global version employs a profit-based charging model. The core logic is: users do not need to pay fees when placing orders for daily buying and selling, but when users realize profits, the platform will charge a 2% net profit fee, taxing only the "winners."

For example, if the total net profit for a winner is $10 million, the revenue from a single prediction market would reach $200,000.

Traders flocked to these markets not only for excitement but also because they can reflect news in real-time—much faster than traditional media. When news of the attacks broke, contract prices jumped instantly, demonstrating the market's "efficiency."

There are always winners in war. In the past, those who profited from conflicts were often arms dealers, oil tycoons, or intelligence traffickers—think of Lockheed during World War II or oil magnates during the Cold War, who earned a fortune from contracts and resource monopolies. Ordinary people? At most, they are bystanders; war means losses and uncertainty for them. But now, the crypto prediction markets have disrupted this pattern. Platforms like Polymarket allow retail investors to bet on geopolitical events, from the date of the U.S.-Iran airstrikes to the probability of regime changes; with just a few clicks, they can share in the spoils.

However, participating in this game also blurs moral boundaries. This shift is poignant: the "dividends" of war have spread from physical supply chains to digital betting tables. Arms dealers are still profiting, but prediction markets have made ordinary users new players. They do not produce missiles, but they can "predict" explosions on the blockchain and reap substantial profits.

As conflicts escalate, the platform's trading volume surges, and the war economy has become digitized.

However, this has also raised many doubts—will the thrill of making money dilute sympathy for real suffering?

Kalshi, as another player, also has a stake in the market. Their "Will Khamenei step down?" market has trading volumes ranging from tens of millions of dollars (slightly varying from different sources). On the day of the attack, trading volume in this market surged to tens of millions of dollars in a single day.

But Kalshi's handling of the situation sparked controversy. One of the platform rules includes a "death does not settle" clause, meaning that if stepping down is due to death, it will not fully pay the "yes" contract.

After the attack, Kalshi paused the market, and CEO Tarek Mansour posted on X to explain: they opposed profiting from individual deaths, so they would settle at the last trade price before death and fully refund all fees. Mansour emphasized that this was to maintain a "moral bottom line" and avoid the platform turning into a "death gambling game." Some users complained that this felt like changing the rules on the fly, but Kalshi insisted this was a preset clause, only clarifying the details a day before the attack.

As a result, the platform lost money but gained a reputation for "not profiting from the dead."

Polymarket's high user anonymity has attracted global capital; Kalshi is more compliant but restricts markets related to war and assassinations.

However, while most players bet based on intuition, some insider players are also quietly making a fortune.

On Polymarket, some accounts placed their bets with such precise timing that it raised suspicions of insider trading. The blockchain analysis company Bubblemaps discovered that six newly created wallets had bet on February 28 when the U.S. would strike Iran just hours before the attack, collectively profiting around $1 million.

These six wallets were all newly established in February of this year, with almost all transactions concentrated on contracts predicting the timing of the U.S. military strike, some positions built just hours before the explosion news first broke in Tehran, with contract buy prices as low as about $0.10. Analysts say this kind of concentrated betting behavior before major geopolitical events is characteristic of "suspected insider trading" seen in previous prediction markets.

However, reports also noted that the related accounts had previously incurred losses in other predictions and that the U.S. government had publicly warned of potential military action weeks earlier, so simply relying on the timing of the trades is not enough to prove illegal activity directly.

These are not isolated cases. Polymarket has faced similar doubts in the past, such as during the 2024 Super Bowl or the Venezuela incident. But this time, it is on a larger scale, involving national security. The CFTC has previously warned against insider trading; Kalshi has also recently penalized the well-known YouTube creator MrBeast's team editor Artem Kaptur for insider trading. Polymarket operates overseas and is under loose regulation, placing it in a gray area.

U.S. Congressman Ritchie Torres is pushing for legislation called the "2026 Financial Prediction Market Public Integrity Act," intending to restrict government officials with non-public information from participating in related prediction market trading. Meanwhile, Polymarket has recently faced regulatory restrictions or bans in multiple countries including the Netherlands, France, Italy, and Singapore.

Of course, not everyone wins. Many bet on the wrong dates and suffered heavy losses. Currently, Polymarket has updated the display at the top of its website to highlight the prediction markets related to the situation in Iran.

Overall, this "war fortune" exposes the double-edged sword of prediction markets. On one hand, they provide real-time data intelligence and insights; on the other hand, they are easily manipulated or exploited based on insider information.

With the trend of betting on everything, some betting in future prediction markets may require stricter regulation and clearer rules. After all, the stakes are real money, and behind them are real lives.

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