Anger grows over Polymarket bets on Iran war: ‘Dystopian death market’

Prediction markets are sold as a way to harness the wisdom of crowds to more accurately forecast the future. 

But when it comes to the Iran war, winning cryptocurrency for correctly predicting outcomes that see civilians bombed and their homes destroyed makes some people concerned — and others very angry. 

Case in point: earlier this week, Democrat congressman Seth Moulton forced Polymarket to pull markets that bet on when the US would confirm the rescue of Air Force service members shot down by Iran.

“They could be your neighbor, a friend, a family member. And people are betting on whether or not they’ll be saved. This is DISGUSTING,” he said. 

He described Polymarket as a “dystopian death market.” The platform backed down in the face of the controversy. It apologized and withdrew the market because it did not meet the company’s usual high standards — which incidentally include betting on whether Jesus Christ’s second coming will occur before December.

“It should not have been posted, and we are investigating how this slipped through our internal safeguards,” the company said.

University of New South Wales international law and relations researcher Karoline Thomsen argues that betting on outcomes that result in human misery is an ethical minefield.  

“I think it’s an entirely different kettle of fish to bet on a footy game than it is to bet on war,” she says. 

“There’s a very obvious moral problem that you are directly benefiting from other people’s suffering and other people’s lives being lost.”

She says that war-related markets also risk tipping off targeted countries.

Polymarket trader Magamyman bet big around 71 minutes before the strikes on Iran became public. They made over $195,000, and another $123,000 wagering Ayatollah Ali Khamenei would be ousted from power.

“Then there is also the whole security question,” says Thomsen. “If you are placing a lot of bets on these strikes going to happen you are also signaling to the countries that you might be striking that ‘hey this is something that’s going to happen.”

Thomsen notes that Polymarket allegedly sells its data to the highest bidder. It’s not clear who buys this information, but there’s always the possibility it may end up in the wrong hands.

Polymarket declined to comment for this story.

Kalshi says death and war are not appropriate markets

Kalshi’s head of communications Elisabeth Diana tells Magazine that the platform’s policies are stricter than Polymarket’s when it comes to bets on the Iran war. 

“We don’t allow markets on war or death — directly tied to death or war or assassination,” she explains. “We don’t want to create perverse incentives so we don’t have those markets. And that is unlike our competitors.”

Kalshi does offer markets less directly tied to the war, relating to questions on reopening the Strait of Hormuz, whether Reza Pahlavi will become leader, or if Iran will transform into a democracy.

But Diana says that enabling bets on outcomes where people could directly get hurt inadvertently creates a financial incentive to bring about that outcome.

“Let’s say like wildfire markets. We don’t allow those because let’s say you traded on a wildfire market. And you said there’s going to be a wildfire in California, well, you could start that wildfire.”

“Death, war, assassination, wildfires, anything related to war and violence and crime — we don’t allow those,” she reiterated.

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Bets can give rise to perceptions of a conflict of interests

Betting markets can also convey an impression of corruption, as we saw in February when there was speculation White House Press Secretary Karoline Leavitt cut a press conference short due to a market wagering on its length. And this week, numerous posters on X suggested that President Trump’s Easter message, “Praise be to Allah,” was related to bets on Polymarket about “will Trump praise Allah on Easter.”

This was not a real market, however. Trump was just being Trump.

Throughout 2025, Polymarket also allowed a market on whether there would be a “Nuclear weapon detonation in 2025?” The odds were around 15% to 20%, but obviously narrowed as December approached.

But when the Iran war heated up, and ‘World War 3’ began…