At a White House press briefing, Trump grimly stated, "You know, unfortunately, the whole world has now become to some extent a gambling den."
At the time of making this statement, his son Donald Trump Jr. was serving as an advisor to both Polymarket and Kalshi, the two largest prediction market platforms, one in a paid position and the other as an investor and board member.
48 hours later, Trump made a U-turn and expressed his support for prediction markets.
This is perhaps the most spectacular political performance art of 2026.
He Changed His Answer Within 48 Hours
The story starts with a U.S. Army Special Forces soldier.
Earlier this year, this soldier was involved in a military operation to capture Venezuelan President Maduro. During the operation, he placed bets on Polymarket, wagering that Maduro would be ousted by the end of the month and that the U.S. would intervene in Venezuela. In a total of 13 transactions, he wagered around $33,000 and ultimately made a profit of over $400,000.
Afterward, he tried to delete his account and obfuscate the fund flows using cryptocurrency. It was to no avail. Federal prosecutors arrested him on charges of misuse of classified government information, telecommunications fraud, and commodity fraud.
A reporter brought up this case to Trump, asking, "What is your view on prediction markets?"
Trump's initial response was, "I have never been very supportive of this industry." He said that gambling had turned the whole world into a casino, with a hint of moral concern in his tone.
48 hours later, he changed his tune.
Trump reversed his position, claiming that "very smart" people he knows believe this industry is worth supporting, and stating that the U.S. should not fall behind in this area.
Two answers, coming from the same person, in less than two days.
The Person Responsible for Convincing Him Was His Son
This flip-flop by Trump is widely credited to his son Donald Trump Jr.
Donald Trump Jr. simultaneously serves as an advisor to both Kalshi and Polymarket platforms and has long been a vocal advocate for prediction markets, especially in election coverage, where he believes prediction markets are more accurate than traditional media in reflecting election outcomes.
But his conflicts of interest go far beyond the word "advisor." His advisory role at Kalshi is paid, and he also made a “two-digit million-dollar” investment in Polymarket through his own venture capital firm, 1789 Capital, and joined Polymarket's advisory board.
It is already quite unusual for one person to take money from two competitors. What's even more unusual is that his father is the top executive of the U.S. federal government, responsible for overseeing this industry, which is regulated by the federal agency CFTC.
A spokesperson for Junior Donald said that he "will not engage with the federal government on behalf of any company."
The reassurance level of this statement is roughly equivalent to a referee announcing that he will not let his team affiliation affect his calls.
Regulatory Agencies, Shrinking
To understand this story, you also need to know another piece of the puzzle.
The Commodity Futures Trading Commission (CFTC), responsible for regulating the prediction market, has reduced its workforce by 24% since Trump returned to the White House, bringing the total number of employees to the lowest point in 15 years.
Meanwhile, Trump's social media company announced plans to launch its own prediction platform, with Junior Donald Trump as a paid advisor to Kalshi and an investor in Polymarket.
On one hand, family members are making money in the industry, while on the other, the agency responsible for regulating this industry is downsizing. Current CFTC Chairman Selig's explanation for this is that artificial intelligence is filling the manpower gap, stating, "Our operational efficiency is higher than ever."
Former senior CFTC officials disagree with this explanation, expressing concerns that regulatory capabilities have declined: "Some layoffs do not make sense. Some things will be put on hold, and they can't pursue as many cases as when fully staffed."
The Maduro case is just the tip of the iceberg. Researchers have already discovered several suspected insider trading cases, including precise bets on oil price futures before the U.S. announced significant policy changes toward Iran.
The World Becomes a Casino, Whose Fault Is It
Let's go back to Trump's statement: "Unfortunately, the entire world has to some extent become a casino."
When he said this, he probably forgot that he himself built a real casino empire in the 1980s, which later closed down due to a series of bankruptcies. He probably also forgot that the Memecoin he issued is essentially a casino chip.
Today, the monthly trading volume of the prediction market surged from around $1.2 billion in early 2025 to over $20 billion in January 2026, with over 800,000 active wallets per month.
This casino is thriving.
As for the arrested soldier, he was just an ordinary player who won $400,000 in this casino using classified information. He crossed the line. But he simply made too obvious what something anyone close to power might do.
As one analyst put it: How many of Trump's direct subordinates have tried the same thing? No one knows. Has the DOJ investigated? We haven't heard anything either.
48 hours later, Trump backtracked, saying that a "very intelligent" person he knows supports the prediction market.
Everyone knows who he is referring to.
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