Hegseth Bars Troops From Using Inside Info on Polymarket, Kalshi
On Tuesday 20 October 2026, Defense Secretary Pete Hegseth signed a memo that puts Polymarket and Kalshi off limits to anyone betting on what the public doesn't know. It reached the press on Thursday 22 October, and the prediction markets have just become a line in a Pentagon rulebook.
The memo, dated Tuesday 20 October 2026 and first reported by CBS News, bars Pentagon staff and military personnel from placing wagers with nonpublic government information. It names the prediction markets Polymarket and Kalshi, and DefenseScoop reports it also covers traditional betting platforms. The ban applies whether the information is classified or merely unpublished. Violations can bring administrative or disciplinary action and, where appropriate, criminal charges under the Uniform Code of Military Justice or federal law.
The logic is as much about judgment as secrecy. Hegseth wrote that enemies watch these markets, and that any trade on a military outcome creates a signal foreign intelligence services could exploit. He also argued that money on the line bends the person holding it: “A logistician with money riding on a strike date has an interest in that date.” The Pentagon told the AP it had nothing to add beyond the memo.
The backdrop is a case from April 2026. Federal prosecutors charged Master Sgt. Gannon Ken Van Dyke, a 38 year old Army Special Forces soldier, with using classified knowledge of the operation to capture Venezuelan President Nicolás Maduro to win more than $400,000 on Polymarket. He has pleaded not guilty and was released on bond. The charges are allegations, and nothing in them has been proved.
More than $400,000 on a single market is the number that explains this memo. GLUWULU.
For the prediction market industry, the timing is awkward. The platforms are already fighting regulators and state attorneys general, and now the Pentagon has written their names into a disciplinary warning. Honestlu, few businesses ever get their brand into an order from a defense secretary. The Spirit of Gambling has always tolerated a bluff, but a marked deck is another matter.
Every table has a rule about who may know the card before it is turned. The Pentagon has just written its own, and the first hand played under it will be the real test.
Should troops be banned from prediction markets entirely?
No right answer. Just your gut, and the Spirit watching.
