Polymarket founder and CEO Shayne Coplan said the prediction market industry's war-related contracts face growing risks and acknowledged that rising visibility brings "more money, more problems" -- a blunt concession from one of the sector's most prominent figures that its flagship product threatens to become a political liability.
Speaking at the MIT Sloan Sports Analytics Conference 2026, Coplan argued prediction markets still serve a genuine informational function but described Iran as "complicated" and said the fog of war breeds misunderstanding.
"There's still a lot of resistance to innovation that kind of also seems jarring to begin with," Coplan said on Saturday. But "that's what makes it innovative and disruptive."
His remarks reflect a broader defense by the prediction market industry against criticism over insider trading risks and the ethics of wagering on conflict.
Bettors placed $425.4 million in wagers on geopolitical questions on Polymarket in the week ending March 1, up from $163.9 million the week before, according to user-compiled data on Dune Analytics. US regulations are understood to prohibit financial contracts tied to war and most prediction markets avoid them. But Polymarket’s main exchange operates offshore.
Coplan acknowledged the controversy but argued prediction markets provide real-world utility in high-stakes situations.
"When I get hit up by people in the Middle East who are saying, 'Hey, we're looking at Polymarket to decide whether we sleep near the bomb shelter; we look at it every day' and I'm like, 'Oh, it's really that popular over there?'" he added. "That's very powerful. That's an undeniable value proposition that did not exist before."
Coplan also said that insider trading dynamics in prediction markets are fundamentally different from equities, where, for example, there are quarterly earnings. Prediction markets, he argued, provide informational value -- such as forecasting product launches or performance outcomes -- rather than serving as deep, highly traded institutional vehicles.
"Not all markets are equal," he said. "It is apples to oranges" because for prediction markets, "the true value proposition is information and nobody is getting in there and posting huge open orders and trading large size."
Kalshi and Polymarket, the two major prediction market companies, are talking to investors about additional funding at valuations of about $20 billion each, according to a reportBloomberg Terminal by the Wall Street Journal. Kalshi declined to comment when asked by Bloomberg. Polymarket didn't immediately respond to a request for comment.
Ric Best, head of prediction markets at Susquehanna International Group, said insider trading in the stock market centers on how information is used and who has a duty to keep it confidential.
"There's not really a well-defined concept there when it comes to prediction markets," Best said on the same panel. "When people think of the term 'insider information,' one of the things that people think about is fairness."
But already "there are certain things you can't do," he said. "You can't do markets that are going to create such a temptation for bad action. You can't list a market on will this person be assassinated," among others, Best said.
"This is a new industry," he said. "It's still getting figured out. There are regulators who are doing rulemaking and it's catching up to where we need to be."
Susquehanna recently teamed up with Robinhood Markets Inc. to take over LedgerX, a US-based derivatives exchange, giving them a foothold in prediction markets as institutional capital flows into the sector.