Pentagon warns troops their online bets may reveal secret plans
A new memo instructs defense officials to avoid wagering on military outcomes to prevent leaking operational details to foreign adversaries.
By Priya Sharma ·
The Department of Defense has issued a stern directive telling its employees to stop using inside knowledge to profit from prediction markets.
Defense Secretary Pete Hegseth sent a memo on October 20 to senior Pentagon leaders, Combatant Command heads, and field activity directors. The document, titled Do Not Compromise Military Operations for Personal Financial Gain, warns that financial wagers can reveal critical intelligence to hostile nations. The guidance was published by CBS News the following day, highlighting a growing concern within the military about how digital transactions might expose operational strategies.
Hegseth argued that enemies closely monitor these markets for subtle shifts in activity. He explained that when a service member, intelligence professional, or civilian makes a bet on a military outcome, they create a distinct signal. Hostile foreign intelligence services can then aggregate and correlate these signals to anticipate American movements, targets, and timing. The Secretary emphasized that the lives of troops often depend on the enemy not knowing what is coming next. He stated that the men and women who carry the flag into harm's way deserve a force that protects them, rather than one that exposes them for personal financial gain.
Recent incidents have brought this issue to the forefront of military attention. In April, a U.S. Army soldier was arrested and charged with using confidential information to place bets on Polymarket. The soldier allegedly wagered on the timing of the military's capture of Venezuelan President Nicolás Maduro and made $410,000 in profits. Earlier in the summer, an August report from the Anti-Corruption Data Collective found 152 suspicious wallets. These wallets placed longshot bets on military and defense markets and collectively won $8 million, suggesting a pattern of informed wagering.
The memo specifies that the prohibition applies to all financial platforms, including traditional betting services and prediction markets like Polymarket and Kalshi. Hegseth wrote that Defense Department personnel may not make any financial transaction informed by nonpublic information. This rule covers both classified and unclassified data, ensuring that no amount of insider knowledge can be converted into a personal profit if it risks operational security.
This directive arrives as prediction markets continue to gain popularity among the general public and within the defense sector. By treating financial transactions as potential intelligence leaks, the Pentagon aims to close a gap that adversaries might exploit. The guidance reflects a broader shift in how the military views digital footprints and the intersection of personal finance with national security operations.
The outlook for military personnel is now clearer than before, with strict boundaries drawn around what information can inform their financial decisions. Leaders will likely monitor compliance closely, knowing that a single misplaced bet could reveal strategic intent. This move signals that the department is taking the influence of prediction markets on military judgment very seriously.
Source: Ars Technica
