(NEW YORK) -- The U.S. Army special forces soldier who was indicted last week on charges of using classified information about the capture of Venezuelan President Nicolas Maduro to make more than $400,000 on Polymarket is set to appear in a Manhattan courtroom Tuesday.
Master Sgt. Gannon Ken Van Dyke is scheduled to be arraigned following his release last week on a $250,000 bond.
In what is believed to be the first case of insider trading on a prediction market, prosecutors alleged that Van Dyke used classified information from his work in the planning and execution of the Maduro capture to place 13 bets on the outcome of the operation.
Prosecutors allege that Van Dyke placed bets on Dec. 27 through the evening of Jan. 2 -- hours before soldiers entered Venezuelan airspace for the pre-dawn operation. After President Donald Trump made the operation public later that day, Van Dyke allegedly profited $409,881 from his $33,034 in bets.
"The defendant allegedly violated the trust placed in him by the United States Government by using classified information about a sensitive military operation to place bets on the timing and outcome of that very operation, all to turn a profit," U.S. Attorney for the Southern District of New York Jay Clayton said in a statement last week. "That is clear insider trading and is illegal under federal law."
The indictment also alleges that Van Dyke attempted to hide the evidence of the illegal trades by attempting to delete his Polymarket account and changing the email address associated with his cryptocurrency exchange account.
Following his arrest on Thursday, Van Dyke briefly appeared in a North Carolina courtroom on Friday. After acknowledging that he understood the charges and potential penalties, he signed a bond and agreed to surrender his passport, limit travel to parts of New York and North Carolina, and no longer possess a firearm unless it is part of his active military service.
His case is being overseen in New York by U.S. District Judge Margaret Garnett, who is also presiding over the high-profile federal case against alleged UnitedHealthcare CEO assassin Luigi Mangione.
Amid mounting criticism of prediction markets for allegedly enabling insider trading, Polymarket CEO Shayne Coplan said his company is "constantly" monitoring for suspicious activity and referring cases to authorities. Coplan argued that the public nature of prediction markets makes it easier to crack down on insider trading.
"The transparency afforded by onchain markets makes global compliance more effective than ever. Every trade is public, permanent, and auditable. Bad actors leave a trail," he said.
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