Defense Secretary Pete Hegseth has directed all U.S. military personnel and Pentagon civilians to stop using nonpublic government information for wagers on prediction markets or other betting platforms.
The one-page memorandum, dated October 20 and circulated to senior defense leaders, combatant commanders, and agency heads, explicitly bars such activity whether the underlying details are classified or merely unpublished.
Hegseth framed the restriction around operational security.
Adversaries monitor activity on platforms including Polymarket and Kalshi, he wrote, so any financial transaction by a service member, intelligence specialist, or department civilian that turns on a military result functions as a detectable indicator.
Those signals can be collected, cross-referenced, and leveraged by foreign intelligence services to forecast American troop movements, intended targets, and the timing of operations.
The lives of those carrying out the missions frequently hinge on the opposition remaining unaware of what is coming, the secretary added, and personnel who generate such indicators for personal profit place their colleagues at unnecessary risk.
The memo also addresses a separate concern: the potential distortion of professional judgment when financial incentives are introduced.
A logistics officer with a stake in a particular strike date acquires a personal interest in seeing that date materialize.
An analyst holding a position on a specific outcome develops a stake in that result occurring.
Hegseth described this as a dilution of the warrior ethos the department has sought to restore.
Violations may trigger administrative or disciplinary measures and, where warranted, criminal prosecution under the Uniform Code of Military Justice or applicable federal statutes.
The prohibition extends to all financial platforms, not only the named prediction markets.
The directive arrives months after federal authorities charged Army Master Sgt. Gannon Ken Van Dyke, a Special Forces member who participated in planning and executing the January operation that captured Venezuelan leader Nicolás Maduro.
Prosecutors allege Van Dyke placed roughly $33,000 in Polymarket contracts between late December and early January, securing more than $400,000 in profits from advance knowledge of the mission.
He has entered a not-guilty plea.
Broader scrutiny of military-related trading on prediction markets has continued, with outside analyses flagging scores of accounts that appeared to trade on sensitive operational information and referrals of multiple cases to the Justice Department.
A defense official confirmed the memo’s authenticity when contacted but declined to provide further details beyond its text.
The measure codifies and strengthens existing expectations that personnel with access to nonpublic military information must not convert that access into personal financial advantage on markets that adversaries can observe.
