Pentagon orders troops to stop betting on wars

Defense Secretary Pete Hegseth has officially warned that military personnel must stop using nonpublic information to place bets on prediction markets. The new directive aims to prevent wagers from providing critical clues to enemy nations regarding U.S. military movements and strategies.

The memo, which went out on October 20, was published yesterday by CBS News. It was distributed to senior Pentagon leadership, Combatant Command leaders, and directors of Defense Department field activities. The subject line of the document was blunt: “Do Not Compromise Military Operations for Personal Financial Gain.”

Hegseth argued that hostile foreign intelligence services actively monitor these financial platforms. When a service member or civilian makes a bet on a military outcome, they create a signal. This signal can be aggregated and exploited by adversaries to anticipate American targets and timing. Hegseth emphasized that the lives of troops depend on the enemy not knowing what is coming next.

The secretary stated that the men and women serving in the military deserve a force that protects them. He noted that they should not be exposed to the enemy for the sake of personal financial gain. The memo clarifies that the prohibition applies to all financial platforms, including traditional betting services and prediction markets like Polymarket and Kalshi.

The rules apply regardless of whether the nonpublic information is classified or unclassified. Defense Department personnel are now barred from making any financial transaction that is informed by such internal knowledge. This broad definition ensures that even seemingly minor insider knowledge cannot influence market wagers.

This warning follows a notable incident in April when a U.S. Army soldier was arrested. The soldier was charged with using confidential information to make $410,000 in bets on Polymarket. The wagers were specifically related to the timing of the military’s capture of Venezuelan President Nicolás Maduro.

An August report by the Anti-Corruption Data Collective also highlighted the scale of the issue. The group identified 152 suspicious wallets that placed longshot bets on military and defense markets. These accounts won a combined total of $8 million, raising concerns about systematic exploitation of insider information.

The memo serves as a clear signal that the Pentagon is taking the intersection of finance and warfare seriously. By restricting how personnel interact with prediction markets, leadership hopes to preserve the element of surprise in military operations. This move sets a new standard for financial conduct within the Department of Defense.

Going forward, the Department of Defense will likely monitor compliance with these new guidelines. The directive reinforces the idea that personal financial decisions made by military staff can have direct strategic consequences. This approach aims to safeguard operational integrity while protecting the safety of those serving in the field.