Israeli authorities have arrested several people and charged two suspects — a civilian and a military reservist — for allegedly using classified military information to place bets on Polymarket.

Prosecutors in Tel Aviv said the suspects face bribery and obstruction of justice charges, following reports that officials wagered on sensitive events such as a potential Israeli strike on Iran.

The case marks the first publicly known arrests tied to prediction market bets allegedly based on military secrets.

The controversy highlights regulatory differences between Polymarket and U.S.-regulated rival Kalshi, as well as the growing political connections of the industry, including ties to Donald Trump Jr., NPR has reported.

Experts warn that exploiting classified information for betting could endanger national security by signaling military intentions to adversaries.