A US special forces soldier has pleaded not guilty to using classified information to win big in the prediction market
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A US special forces soldier pleaded not guilty Tuesday to using classified information about the kidnapping team of former Venezuelan leader Nicolás Maduro to win more than $400,000 in US dollars from the Polymarket.
Gannon Ken Van Dyke, 38, entered federal court in Manhattan after being charged with unlawful use of classified information for personal gain, theft of non-public government information, property fraud, fraud and money laundering.
He was released on $250,000 US bail and his travel was restricted to certain parts of New York, North Carolina, California and the necessary points to travel between them.
Prosecutors said evidence in the case will include information from subpoenas, cryptocurrency exchange records, search warrants and social media accounts.
Defense attorney Zach Intrater told Judge Margaret M. Garnett that he doubted there would be much controversy from “the actual incident,” but he suspected the case would rise and fall on the motions he would make on his client’s behalf.
The judge ordered Van Dyke to return to court on June 8 for a pretrial conference.
The case comes at a time of intense scrutiny of prediction markets, which allow people to trade or bet on almost anything, as policymakers seek tighter regulation of the platforms amid concerns about insider trading.
The Trump administration has been supporting the expansion of the market industry.
The president’s eldest son is an advisor to Polymarket and its main rival, Kalshi, is also an investor in Polymarket. Trump’s social media platform, Truth Social, is launching its own prediction market called Truth Predict.
Prediction markets like Kalshi and Polymarket have exploded in popularity, processing billions in daily trades. Nationally, CBC’s Nora Young reveals how they work and why experts say it’s just another form of gambling that comes with the dangers of insider trading and fraud.
Prosecutors say Van Dyke was involved in the planning and implementation of Maduro’s abduction and had signed nondisclosure agreements focused on the operation, but he ended up placing a series of bets related to Maduro’s exit from power on Jan. 31.
According to the criminal complaint, bets of up to $33,000 US were placed over a three-day period and resulted in “a total of $404,000. [US] of profit.”
Polymarket, one of the largest prediction markets, flagged the suspicious activity and referred it to the government, according to CEO Shayne Coplan.
Van Dyke, who is stationed at Fort Bragg near Fayetteville, NC, was granted bond after a North Carolina court hearing last week and will continue his trial in New York.
