War-related prediction markets could create financial incentives for people to influence the events they are betting on, including when conflicts begin, Ryan Kirkley, co-founder and CEO of crypto settlement firm Global Settlement Network, told MarketDash in an interview Wednesday.

His warning took on fresh relevance after President Donald Trump, in a Time interview, said he had rejected Iran's latest ceasefire proposal and that ramping up U.S. bombing after the Nov. 3 midterm elections was "possible."

Kirkley described a hypothetical in which an Iranian guard earning $18,000 a year is offered $1 million because hundreds of millions of dollars are riding on the day a conflict starts.

"He has every incentive to accidentally press a button and start the war that day," Kirkley said. "We've created a system in which there are now economic incentives for a war that's just going to kill people."

Prediction Markets Have Become 'Retail Extraction,' Kirkley Says

Kirkley said prediction markets have become an "insider trading market," where ordinary users can end up trading against people with privileged knowledge of military actions, announcements or public remarks.

"You're no longer in a fair environment; instead, you're just retail extraction," he said.

A network of wallets flagged by analysts netted nearly $1 million around U.S. and Israeli strikes on Iran earlier this year.

Kirkley pointed to research from Citizens JMP Securities that found prediction-market users had a median return of minus 8%, compared with minus 5% for sportsbook users between July 2025 and mid-March 2026.

If enough money is at stake, traders may also have an incentive to influence what happens, he said. Even strict identity checks may not eliminate that risk if a trader can pay somebody else to influence the underlying event.

Death or survival markets should be banned outright, he said, while mention markets may also be too vulnerable to manipulation.

'At Their Best … They're Gambling'

Kirkley rejected the argument that prediction markets escape traditional gambling concerns because users can research an outcome.

"I think it's almost worse because you think you can know something or research something to know the outcome," he said.

That concern echoes a recent MarketDash interview with University of Washington researcher Uttara Ananthakrishnan, who said prediction markets can be "equally risky" as sports betting for people with gambling problems.

Kalshi is fighting states over whether its sports contracts should fall under federal derivatives regulation or state gambling laws. The exchange does not offer war or assassination markets, which it says are prohibited on its federally regulated platform.

Kirkley said whatever rules emerge will reach well beyond Kalshi and Polymarket.

That includes brokerages such as Robinhood Markets Inc. (NASDAQ:HOOD), which generated $156 million from event contracts in the second quarter, more than its $129 million from equities or $100 million from cryptocurrency trading.

Kirkley Wants Limits Before Bigger Problems Emerge

Kirkley said reasonable restrictions now would be preferable to allowing abuses to continue until regulators impose something more severe.

If the choice is between the current environment and much tougher intervention, he said he would take the latter.

"We're better to have a hard shutdown or a hard regulation than we are to let it roam free," Kirkley said.

Kalshi and MarketDash have an existing data collaboration agreement.